South Korea's industrial output grew for the 24th straight month in June, indicating that the nation's economic recovery remains on track, a government report showed Friday.

   According to the report by Statistics Korea, production in the mining and manufacturing industries expanded 6.4 percent last month from a year earlier, slowing from a revised 8.1 percent growth in May.

   The June figure, however, marks straight output growth from July 2009 onward. The industrial output also rose 0.7 percent from a month earlier, the report showed.

   "Output growth slowed from the previous month due to relatively high-paced growth tallied during the same period a year earlier, but the nation's economic recovery appears to remain on track, given that the production keeps growing for such a long period," Jeon Baek-geun, director of the agency's short-term industrial statistics division, told Yonhap.

   Increased demand for automobiles, semiconductors and their components led the overall output gains last month.

   Production of cars jumped 17 percent on-year thanks to higher demand from home and abroad, while semiconductors and their components saw a 12.8 percent gain over the same period, the report showed.

   The data, however, comes as South Korea is facing heightened economic uncertainty like the eurozone debt crisis and stalled U.S. debt talks while inflationary pressure is building up.

   The South Korean economy grew at the slowest pace in six months in the second quarter as export gains sharply eased amid global economic uncertainty.

   According to the central bank, the economy grew 0.8 percent in the April-June period, down from a 1.3 percent on-quarter expansion in the first quarter. Its gross domestic product rose 3.4 percent last quarter from a year ago, the slowest in about 2 years.

   Inflation is yet another cause for concern among policymakers here that has prompted the government to stay more focused on price stability over economic growth.

   Recently, the government revised down its growth projection for this year from 5 percent to 4.5 percent, while raising its inflation target from 3 percent to 4 percent.

   The statistics agency's report, however, showed that the outlook for the economic situation appears to be improving.

   The leading economic composite index, a gauge of economic performance eight to 15 months ahead of time, gained 0.4 percentage points from a month earlier, the report showed.

   The index measuring the current economic conditions also rose 0.3 percentage points from a month earlier. This marked the second straight month that the two major outlook indicators have improved.

   Consumer sales and corporate investment remained strong.

   Retail sales rose 5.6 percent from a year earlier, while facility investment gained 4.3 percent over the same period.

   The growth in facility investment slowed from 10.1 percent in the previous month but it still marked the second straight month of on-year expansion, the report showed.

   The factory operating rate also increased. The nation's manufacturing plants operated at 82.5 percent of capacity last month, up 1.1 percentage point from a month earlier, according to the report.

Source: Yonhap News (July 29, 2011)