The Korea Development Institute(KDI) reports continued signs of improvement in consumption and production.

In its Monthly Economic Trends report released Monday, the state-run think tank said the gradual increase in production, centered on the service industry, continues amid improving consumption. 

The KDI has been using positive terms, including "improvement" and "increase," to describe the economy since last November.

In December, industrial output grew one-point-eight percent from the previous year despite a contraction in the construction industry after output in the service sector jumped three-point-seven percent.

Production in mining and manufacturing, meanwhile, slipped zero-point-three percent during the same period. 

The KDI said that although contraction in business sentiment is easing, external risks, including the possibility of a U.S. tariff hike and oil price volatility, appear to be growing. 

Retail sales, a key indicator of consumption, rose one-point-two percent.

Average daily exports in January expanded 14 percent on the back of robust exports of semiconductors.