(Updates with government comments, details)
SEOUL, Sept 29 (Reuters) - South Korea's industrial output rebounded more strongly than expected in August, fanned by robust exports and after output fell at the steepest pace in seven years in July, the government said on Monday.
The better output performance was also linked to the end of a a strike at the country's top car maker Hyundai Motor Co .
Industrial output rose a provisional 3.4 percent in August from July, the National Statistical Office (NSO) said, topping forecasts for a 2.0 percent rise in a Reuters survey of 10 economists conducted on Friday. The data was seasonally adjusted.
"Industrial activity was abnormally poor in July because of labour disputes at Hyundai Motor, which accounts for about 55 percent of the country's automobile production," said Shin Seung-woo, the director of the NSO's industrial statistics division.
Industrial output fell 3.8 percent in July from June.
But August's rebound in output was capped by labour unrest at the country's second-biggest car firm, Kia Motors Corp , and a dispute involving truck drivers, Shin said.
Ignoring seasonal factors, output rose 1.5 percent in August year-on-year, versus July's 0.7 percent rise and an 8.8 percent rise in August 2002, the NSO said.
Reflecting continued subdued domestic consumption and investment, wholesale and retail sales dropped 2.7 percent in August from a year earlier, while capital investment dipped 7.8 percent, it said.
Exports in August, driven largely by wireless telecommunications devices and computers, rose 10.9 percent to $15.48 billion, while imports were up only 5.4 percent at $13.56 billion due to depressed domestic demand, the commerce ministry said this month.