Korea Production Jumps Most in 17 Months as Supply Woes Ease

South Korea’s factory production jumped the most since mid-2020 last month, suggesting supply disruptions that hurt manufacturing in key industries were easing before an omicron-triggered surge in global infections.

Industrial production rose 5.1% in November from the previous month, the statistics office said Thursday, ending three months of declines and beating economists’ estimate for a 2.5% increase. Automobile production gained 11.3% as a supply shortage of chips eased, while semiconductor manufacturing increased 4.5%.

Korea’s output rebound, along with improvements seen in Japan, adds further evidence that global manufacturing was on the mend before the new variant disrupted economic re-openings in some countries. Outside the pandemic, the monthly production gain was the biggest seasonally adjusted gain since 2009.

Read More: Japan Production Jumps by Record as Car Manufacturing Rebounds

Korea’s preliminary trade figures last week suggest global demand has held up despite a worsening of the pandemic, but there’s much uncertainty as to whether the momentum will be carried over into 2022.

While countries are refraining from re-imposing harsh lockdowns, heightened caution against the variant may still weigh on business activity.

Finance Minister Hong Nam-ki said in a Thursday Facebook (NASDAQ:FB) post that the November gains in output fully recovered the losses in the past three months and contributed to the fastest increase in facilities investment since 2014.

Still, “recent economic conditions suggest we can’t be complacent over November improvement,” he wrote, citing external risks from a global spread of omicron, inflation, and persistent supply disruptions.