The seasonally-adjusted December growth reversed a fall of 1.6 per cent in November but was smaller than the market's average forecast for a rise of 2.1 per cent.

The government downgraded its verdict on overall industrial production.

'Production is staying flat as a whole,' the Ministry of Economy, Trade and Industry said in a monthly report, compared with its statement last month that industrial output was on a moderate uptrend.

The downgrading stemmed from a gloomy outlook for January and February, a ministry official said, noting factory production was predicted to fall 0.4 per cent in January and another 2.2 per cent in February.

'We have to take into account outlooks for January and February when issuing an overall view. Since the predictions are negative, it is difficult now to say production is on an uptrend even moderately,' the official said.

As for all of 2007, output rose an unadjusted 2.7 per cent from the previous year.

The index hit 109.1 against the base of 100 for 2000, scoring a record high for the second consecutive year. -- AFP