By Yoon Ja-young
Staff Reporter

Industrial output growth lost momentum last month with the effects of the government's economic stimulus package waning.

According to Statistics Korea, industrial output grew by 0.2 percent in October from a year ago, dipping from the 11 percent year-on-year increase in September.

Industrial output marked year-on-year growth for four consecutive months since July, but the pace of growth has slowed.

Production plunged especially sharply in the auto and metal industries.

The statistics office said that the Chuseok holiday, which fell in October, affected production. It estimated that industrial production marked about a four percent increase from a year ago when excluding the Chuseok effect.

However, the manufacturing operation ratio also fell to 77.3 percent from 80.3 percent in September.

It seems that the economic stimulus package might be losing momentum. The consumer sentiment index, also fell to 113 in November from 117 the previous month, turning downward for the first time in eight months.

The business survey index, which rose to 92 in October after hitting 43 in February, also dropped to 89 in November, falling for the first time in nine months.

The strengthening of the Korean currency is affecting the price competitiveness of Korean exporters, and the domestic economy is continuing its sluggish mood despite stimulus programs.

Economists also point to falling asset prices as a burden on consumer sentiment. "Households' outlook on assets have already have plunged, while job market conditions aren't good enough to fulfill people's expectations for employment," said Jeong Yong-taek, an economist at KTB Securities.

Services output, meanwhile, grew by 1.5 percent from a year ago, marking the seventh consecutive monthly rise. However, it dropped by 1.4 percent from the previous month.

The travel industry saw a 38.4 percent plunge in the index following the spread of swine flu. Resorts and amusement park industries also saw a 28 percent drop.

Hospitals, meanwhile, saw a 15.1 percent rise.

Facility investment dropped by 5.8 percent from the previous month, but marked 0.3 percent year-on-year growth. Construction orders jumped 27.2 percent from the previous year upon the government's huge infrastructure projects and the reconstruction of homes.

chizpizza@koreatimes.co.kr