Industrial production rose by a seasonally adjusted 7.2% month-on-month in June, according to Statistics Korea, sharply reversing a 7.0% decline in May and the fastest growth since February 2009.

That also beat a 2.1% rise, tipped in a Reuters survey of eleven economists, by a large margin.

"(Friday's data) showed more clear signs of improvement in the economy and strengthens the possibility of a economic recovery in the third quarter," vice finance minister Kim Yong-beom said.

A breakdown of data showed production of semiconductors, the country's top export, rose 3.8% from May on demands of DRAM chips for servers, while cars and electric devices surged 22.9% and 13.7%, respectively.

From a year earlier, factory output edged down 0.5%, but that was slower than the previous month's 9.8% decline and a 4.9% fall forecast in a Reuters survey.

While more economies have re-opened their economies from coronavirus curbs, weak demand on surging infections across the world will likely weigh on the trade-reliant economy for some time.

"It is premature to say the economic recovery is on track as the protracted spread of virus still remains a risk," said Park Sung-woo, an economist with DB Financial Investment.

Factory output data from other countries including China and the United States has firmed in recent months, though the rate of recovery is seen slowing, he added.

The nation's outbound shipments were predicted to contract 9.7% year-on-year in July, extending the decline to a fifth consecutive month. Preliminary data is due on Saturday.

South Korea is the latest Asian country to enter recession, joining Japan, Thailand and Singapore, after its economy marked its worst decline since the Asian Financial Crisis in the second quarter.

By Joori Roh