UPDATE 2-S.Korea Nov output rebounds, eases slowdown concerns

* Nov factory output up 1.4 pct, first rise after 3-mo slide

* Growth seen picking up in Q1 2011 after Q4 slowdown

* Data in line with market view for more rate rises ahead

(Updates with markets, interest rate view) By Kim Yeonhee and Cheon Jong-woo

SEOUL, Dec 30 (Reuters) - South Korea's factory output and service-sector activity expanded in November in a sign of the economy's resilience in the face of cooling global demand, cementing expectations interest rates will rise early next year.

Analysts said the figures indicated the economy was being powered by recovering demand at home and in emerging markets, which helped make up for sluggish growth in major developed economies . Industrial production rebounded in November after three months of declines, rising 1.4 percent from October, slightly more than forecast, statistics office data showed on Thursday.

Service-sector output rose 0.8 percent and retail sales grew 2.9 percent, all on a seasonally adjusted basis from the previous month.[ID:nTOE6BS02M] [ID:nTOE6BS07H]

Seoul stocks and the won both rose slightly on the last trading day of the year as investors took the set of data released during the day as pointing to a sustained recovery in the economy. Bond prices showed a muted reaction. "Today's data set contained many details pointing to the slowdown in economic growth nearing an end, " said Peter Jongyoun Park, a fixed-income analyst at Woori Investment & Securities "I expect the economy to show signs of hitting the bottom in the first quarter to turn around for faster growth afterwards."

The central bank forecast recently that growth in Asia's fourth-largest economy would slow to 0.4 percent in the final quarter of this year from 0.7 percent in the third quarter. But it saw the economy regaining momentum soon and expanding by more than 1 percent in the first quarter of 2011.

South Korea was among the top performing economies in the Organisation for Economic Co-operation and Development group last year and is tipped to be one of the top three this year. Solid economic growth and signs of rising inflation pressure have prompted the central bank to raise interest rates twice this year and analysts expect more to come from as early as February next year. The Bank of Korea last raised the benchmark interest rate in November by 25 basis points to 2.50 percent and next reviews the rate on Jan. 13. Separately, the central bank said the current account surplus in November more than halved to $1.93 billion from a $4.89 billion surplus in October. It was the ninth month in a row that the country posted a current account surplus. A central bank official told reporters later exports so far this month were "very strong" and should lift the surplus in December sharply higher from November even if firmer global raw materials prices inflated import costs. [ID: nTOE6BS07Y ] (Writing by Yoo Choonsik; Editing by Tomasz Janowski)