Korea’s economic system retreated within the second quarter of the yr amid weaker home demand, whereas exports remained strong, central financial institution knowledge confirmed Thursday.
The nation’s actual gross home product — a key measure of financial development — contracted 0.2 % on-quarter within the April-June interval, matching an earlier estimate, in accordance with preliminary knowledge from the Financial institution of Korea (BOK).
The second-quarter determine compares with the 1.3 % on-quarter enlargement within the January-March interval, which marked the best for the reason that fourth quarter in 2021, when the economic system expanded 1.4 %.
On a yearly foundation, South Korea’s economic system superior 2.3 % within the second quarter, slowing from 3.3 % development for the primary quarter of the yr.
The central financial institution expects the nation’s economic system to satisfy its development outlook given a restoration development.
Within the first half, the economic system expanded 2.8 % on a yearly foundation. Exports will proceed their upward development down the highway, and family revenue will enhance as properly.
For the yr, the financial institution expects the economic system to rebound barely, at 2.4 %, slower than its earlier estimate of two.5 %.
The contraction was considerably broadly anticipated attributable to a base impact the earlier quarter.
Non-public spending contracted 0.2 % on-quarter within the April-June interval, in contrast with a 1.3 % advance the earlier quarter, the central financial institution mentioned.
The nation’s exports climbed 1.2 % within the second quarter, slowing from the earlier quarter’s 1.8 % achieve, whereas imports rose 1.6 %, shifting from a 0.4 % dip the earlier quarter.
Authorities spending elevated 0.6 %, and development funding went down 1.7 % within the second quarter, a shift from the earlier quarter’s 3.3 % achieve, in accordance with the information.
Final month, the central financial institution held its key rate of interest regular at 3.5 % for the twelfth straight time amid moderating inflation and excessive family debt.
The speed freezes got here after the BOK delivered seven consecutive fee hikes from April 2022 to January 2023.
Korea’s financial development slowed to the bottom in three years final yr attributable to a stoop in exports amid tightening financial insurance policies across the globe.
The economic system expanded 1.4 % final yr, slowing from a 2.6 % advance in 2022 and 4.3 % development in 2021.
The 2023 enlargement marks the bottom since a 0.7 % contraction in 2020 through the coronavirus pandemic.
For the yr, the financial institution expects the economic system to rebound barely, at 2.4 %, slower than its earlier estimate of two.5 %. (Yonhap)
