South Korea's industrial output growth slowed in June to 0.1 percent due to sluggish exports stemming from Europe's debt crisis and global economic slowdown, a government report showed Tuesday.

All-industry index, which gauges overall industrial activities, stood at 134.1 in June, up 0.1 percent from a year before, according to Statistics Korea. The figure was down from a 1.8 percent on-year rise tallied in May.

From a month earlier, the index was down 0.3 percent in June, a turn into the negative growth from a 0.5 percent expansion tallied in the previous month.

Output in the mining, manufacturing and electricity & gas sectors expanded 1.6 percent in June from the same month of last year, after growing 2.9 percent in May. From a month before, the production reduced 0.4 percent last month, down from a 1.3 percent on-month increase a month before.

The slower growth came as weak export demand led to faltering domestic production. "Both exports and imports remain weak, which usually means weaker production," Moody's Analytics said in a report before the data release.

South Korea's trade surplus surged to 4.91 billion U.S. dollars in June from 2.22 billion dollars in May, but the surge was attributed to a 5.5 percent on-year reduction in imports, indicating that the Asia's No. 4 economy might see the so-called recession-type surplus last month.

Global economic conditions remained weak. U.S. gross domestic product (GDP) expanded at an annual rate of 1.5 percent in the second quarter, down from a revised 2 percent growth for the first quarter. The figure confirmed that the world's largest economy may grow at a slower pace than initially forecast.

South Korea's real GDP advanced 2.4 percent in the second quarter on an on-year basis. Bank of Korea (BOK), the country's central bank, cut its 2012 growth outlook to 3 percent from an earlier estimate of 3.5 percent after lowering its policy rate by 25 basis points (bps) to 3 percent at the July rate-setting meeting.

"In addition to the second-quarter GDP, other economic indicators such as industrial production will confirm the continuous economic slowdown in South Korea," Kim Jong-soo, an economist at NH Investment & Securities, said before the data release.

Production in the manufacturing sector, which makes up around half of all industrial output, expanded 1.6 percent in June from the same month of last year, after growing 2.9 percent in May. From a month before, the output declined 0.5 percent last month, down from a 1.3 percent rise in May.

Solid demand for chips, parts and primary metals contributed to the on-year growth, but demand for audio & video equipment and machinery remained weak, the statistical agency said.

Shipment in local manufacturers grew 1.8 percent on-year in June due to an advance in chips, parts and oil refining sectors, but the growth slowed compared with May when the shipment expanded 3.6 percent. Inventory growth also fell to 10.7 percent in June from 15.3 percent in May.

Local manufacturers operated at an average capacity of 78.2 percent last month, down 1.2 percentage point from the previous month. The factory utilization rate stood at 80.5 percent a year earlier.

Production in the service industry gained 1.2 percent on-year in June, down from a 2.3 percent expansion tallied in May. Upswing in health, social welfare, finance and insurance sectors offset downswing in real estate, rental service and wholesale & retail sectors, according to the report.

Output in the construction sector plunged 16.5 percent on-year in June, down from a 6.4 percent on-year contraction tallied in the previous month. From a month earlier, the production declined 3.3 percent last month, down from a 2.5 percent gain in May.

The Asia's No. 4 economy saw its retail sales grow 0.6 percent in June from a year earlier, down from a 2.2 percent expansion in May. The slower growth hinted that consumer demand cooled in lined with worsening economic conditions.

Facility investment logged a 5.6 percent contraction in June from a year before, down from a 1 percent fall in May. The deceleration was ascribable to falling investment in general machinery and electronic equipment sectors.

The value of construction completed at a constant price sank 16. 5 percent on-year in June, but the figure for construction orders received at a current price grew 2.6 percent over the same period.

The leading index of economic indicators, which gauges business activities around six months ahead, rose 0.5 point on-month to 100 in June, but the coincident index, measuring current economic conditions, stayed unchanged at 98.9.