South Korea chip output drops for first time in over four years

South Korea Slashes Chip Production for the First Time in Over Four Years.

South Korea's semiconductor output fell for the first time in more than four years in a sign that chipmakers are bracing for a slowdown in global demand.

Semiconductor production fell by 1.7% in August from a year earlier, a sharp reversal from the 17.3% gain reported in July, Statistics Korea data showed Friday.

Since January 2018, the first drop in output coincides with chip inventories soaring 67.3%, suggesting producers are adjusting to a deteriorating international outlook. Factory shipments fell for a second consecutive month in August, dropping 20.4%, the statistics office said.

The global economy is headed for a downturn due to cooling electronics demand, which has been a major source of economic growth, according to a trio of indicators.

Micron Technology Inc. said in the US that it is acting swiftly to cope with the weakening demand, including slowing production.

Korea s Exporters Show More Hints of a Slowdown in Global Demand

Earlier this month, Korea's Samsung Electronics Co. warned of a gloomy outlook for the second half of the year. The market for dynamic random access memory, Samsung's key cash driver, is tumbling so fast that it has halved in size between May and July, according to IC Insights.

Chipmakers are the biggest industrial sector in South Korea's trade-reliant economy, which is battling high energy prices and a currency that has depreciated the most in Asia this year outside the yen.

Americans are moving to cheaper places when home prices increase, despite the fact that Home Prices aren't as high as in the United States.