SEOUL, Nov 1 Reuters South Korea39;s factory activity shrank for a second straight month in October, with output falling by the most in 16 months, a private survey showed on Friday, adding to recent signs of a slowdown in global demand.

The purchasing managers index PMI for manufacturers in Asia39;s fourthlargest economy, compiled by SP Global, stood at 48.3 in October on a seasonally adjusted basis, unchanged from September.

In September, the index fell below the 50mark, which separates expansion from contraction, for the first time in five months and registered the lowest reading since June 2023.

The latest survey showed output declined at the fastest rate since June, 2023, with firms noting lower order volumes due to muted economic conditions. The slump in new orders, however, was marginally softer than in the previous month.

The fall in new export orders also narrowed slightly, with firms saying demand was weak in the United States, Europe and China.

With the sector often viewed as a bellwether for global exports, October data provides likely indications of a gradual slowdown in global trade and industrial activity, said Usamah Bhatti, economist at SP Global Market Intelligence.

South Korea39;s economy barely grew in the third quarter due to weakness in exports, after an unexpected contraction in the second quarter, raising the chance for more stimulus to support growth.

The survey also showed purchasing activity shrank for the first time since August 2023…