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197419
Wed, 07/27/2011 - 02:47
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https://oananews.org//node/197419
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S. Korean economy grows 0.8 pct on-quarter in Q2
By Kim Soo-yeon
SEOUL (Yonhap) - The growth of the South Korean economy slowed in the second quarter from three months earlier as the growth of exports eased and construction investment remained weak, the central bank said Wednesday.
Asia's fourth-largest economy grew 0.8 percent in the April-June period, down from a 1.3 percent on-quarter expansion tallied in the first quarter, according to an advance estimate of the Bank of Korea (BOK). The country's gross domestic product (GDP), the broadest measure of economic performance, rose 3.4 percent last quarter from a year ago.
The second-quarter growth was lower than the 0.9 percent expansion predicted by the central bank on July 15. The growth rate marked the slowest since a 0.5 percent gain in the final quarter of last year.
The central bank said the quarterly growth bottomed out in the second quarter and is likely to pick up to 1.5 percent each in the third and fourth quarter, indicating that the Korean economy stayed on a robust recovery track. The BOK expects the economy to grow 4.3 percent this year while the government's growth forecast stood at 4.5 percent.
"Consumer spending was on the steady rise and facility investment expanded, but the growth pace of exports slowed amid sluggish construction investment," the BOK said in a statement.
Analysts said the second-quarter growth slowed down mainly because external uncertainty such as the eurozone debt crisis heightened and high inflation eroded domestic demand.
The growth data lent support to the view that the BOK's tightening cycle will be gradual in order not to hurt the growth momentum. More analysts penciled in one or two more rate hikes within this year.
The BOK froze the key rate at 3.25 percent in July, following a rate increase in June, as external risks increased despite concerns about high inflation. The bank has raised the borrowing costs from a record low of 2 percent since last July.
South Korea's inflation topped the upper limit of the BOK's 2-4 percent inflation target band for the sixth straight month in June. The BOK revised up its 2011 inflation projection to 4 percent from an earlier estimate of 3.9 percent.
The government is sparing no efforts to bring inflation under control by unveiling a set of anti-inflationary steps and clamping down on price rigging. Sustained economic growth and hikes in public utility charges would put upward pressure on inflation in the second half.
According to the central bank, exports, which account for about 50 percent of South Korea's GDP, gained 1.8 percent on-quarter in the second quarter after expanding 3.3 percent three months earlier.
Private spending, one of the main growth engines of the Korean economy, expanded 1 percent, quickening from a 0.4 percent gain in the preceding quarter.
Facility investment grew 4 percent after contracting 1.1 percent in the preceding quarter and construction investment fell 0.4 percent after declining 6.7 percent in the first quarter.
SEOUL (Yonhap) - The growth of the South Korean economy slowed in the second quarter from three months earlier as the growth of exports eased and construction investment remained weak, the central bank said Wednesday.
Asia's fourth-largest economy grew 0.8 percent in the April-June period, down from a 1.3 percent on-quarter expansion tallied in the first quarter, according to an advance estimate of the Bank of Korea (BOK). The country's gross domestic product (GDP), the broadest measure of economic performance, rose 3.4 percent last quarter from a year ago.
The second-quarter growth was lower than the 0.9 percent expansion predicted by the central bank on July 15. The growth rate marked the slowest since a 0.5 percent gain in the final quarter of last year.
The central bank said the quarterly growth bottomed out in the second quarter and is likely to pick up to 1.5 percent each in the third and fourth quarter, indicating that the Korean economy stayed on a robust recovery track. The BOK expects the economy to grow 4.3 percent this year while the government's growth forecast stood at 4.5 percent.
"Consumer spending was on the steady rise and facility investment expanded, but the growth pace of exports slowed amid sluggish construction investment," the BOK said in a statement.
Analysts said the second-quarter growth slowed down mainly because external uncertainty such as the eurozone debt crisis heightened and high inflation eroded domestic demand.
The growth data lent support to the view that the BOK's tightening cycle will be gradual in order not to hurt the growth momentum. More analysts penciled in one or two more rate hikes within this year.
The BOK froze the key rate at 3.25 percent in July, following a rate increase in June, as external risks increased despite concerns about high inflation. The bank has raised the borrowing costs from a record low of 2 percent since last July.
South Korea's inflation topped the upper limit of the BOK's 2-4 percent inflation target band for the sixth straight month in June. The BOK revised up its 2011 inflation projection to 4 percent from an earlier estimate of 3.9 percent.
The government is sparing no efforts to bring inflation under control by unveiling a set of anti-inflationary steps and clamping down on price rigging. Sustained economic growth and hikes in public utility charges would put upward pressure on inflation in the second half.
According to the central bank, exports, which account for about 50 percent of South Korea's GDP, gained 1.8 percent on-quarter in the second quarter after expanding 3.3 percent three months earlier.
Private spending, one of the main growth engines of the Korean economy, expanded 1 percent, quickening from a 0.4 percent gain in the preceding quarter.
Facility investment grew 4 percent after contracting 1.1 percent in the preceding quarter and construction investment fell 0.4 percent after declining 6.7 percent in the first quarter.
