August Production Down 1.3%... "Triple Decrease" in Consumption and Investment for the First Time in Three Months (Update)

In August, domestic production, consumption, and investment all declined. This "triple decrease" is the first time in three months since May.

According to the "August 2026 Industrial Activity Trends" released by the Ministry of Data and Statistics on September 30, overall industrial production last month fell by 1.3% compared to the previous month. After having increased by 2.6% in June and declined by 0.1% in July, production saw another decrease in August.

President Donald Trump, having signed a proclamation imposing a 25% tariff without exceptions on imported steel and aluminum products into the United States, also announced that tariffs on automobiles and semiconductors are under consideration. Meanwhile, on February 13, 2025, export vehicles are waiting to be loaded at Pyeongtaek Port in Gyeonggi Province. Photo by Kang Jinhyung

In the manufacturing and mining sectors, production of machinery and equipment increased by 3.1%. However, production of automobiles plunged 24.8%, while rubber and plastics dropped by 11.0%, leading to an overall 4.8% decline from the previous month. In the service sector, wholesale and retail production decreased by 0.7%. Meanwhile, information and communications rose by 4.7%, and professional, scientific, and technical services increased by 2.3%, resulting in a total 0.5% increase from the previous month for the service industry.

The retail sales index, which represents goods consumption, declined by 1.8% from the previous month. Sales of durable goods such as passenger cars decreased by 4.5%. Sales of nondurable goods such as food and beverages fell by 1.6%. In contrast, sales of semi-durable goods such as clothing increased by 0.4%.

Facility investment fell by 9.5%. Although there was a 1.6% increase in machinery investment, including semiconductor manufacturing equipment, investment in transportation equipment such as ships and aircraft plummeted by 32.8%. On the other hand, construction completed increased by 1.9% as building construction performance improved by 4.5%.

The cyclical component of the coincident composite index, which reflects the current economic situation, rose by 0.5 points compared to the previous month. However, the cyclical component of the leading composite index fell by 0.1 points.

This content was produced with the assistance of AI translation services.