ID :
199224
Fri, 08/05/2011 - 05:04
Auther :
Shortlink :
https://oananews.org//node/199224
The shortlink copeid
S. Korea sees low risk of U.S. double dip
SEOUL (Yonhap) - The recovery of the U.S. economy is weaker than expected and its pace may further slow down, but the world's largest economy is unlikely to relapse into a recession, a senior finance ministry official said Friday.
A series of economic data from the U.S. is raising concerns that the economy is losing momentum for a recovery, facing another recession.
The U.S. economy expanded at less than a 1 percent annual rate in the first half of the year, and consumer spending there dropped in June for the first time in nearly two years, according to the latest data to underscore the fragile state of the economy.
"There is a low possibility of the U.S. economy facing a sharp downturn. It takes time for its fundamentals to get better, but the government does not see the U.S. economy facing a double-dip recession," said Yoon Jong-won, director general of the finance ministry's economic policy division.
The official said South Korea is keeping a close eye on the development of the U.S. economy to prepare for the worst-case scenario.
The South Korean economy, heavily dependent on overseas demand, grew at the slowest pace in six months in the second quarter of the year, as export gains sharply eased amid the global economic uncertainty.
Asia's fourth-largest economy grew 0.8 percent in the April-June period, slowing from a 1.3 percent on-quarter expansion tallied in the first quarter.
But exports surged 27.3 percent on-year to a new monthly high of US$51.4 billion in July amid heightened uncertainties over the U.S. economy.
Concern over the U.S. economic slowdown is also spurring speculation the U.S. Federal Reserve will start another stimulus program. However, the finance ministry doesn't agree.
"The current inflation rate in the U.S. is very high given its economic expansion, so it is hard to see it moving in that direction," said another official at the ministry, asking not to be named.
A series of economic data from the U.S. is raising concerns that the economy is losing momentum for a recovery, facing another recession.
The U.S. economy expanded at less than a 1 percent annual rate in the first half of the year, and consumer spending there dropped in June for the first time in nearly two years, according to the latest data to underscore the fragile state of the economy.
"There is a low possibility of the U.S. economy facing a sharp downturn. It takes time for its fundamentals to get better, but the government does not see the U.S. economy facing a double-dip recession," said Yoon Jong-won, director general of the finance ministry's economic policy division.
The official said South Korea is keeping a close eye on the development of the U.S. economy to prepare for the worst-case scenario.
The South Korean economy, heavily dependent on overseas demand, grew at the slowest pace in six months in the second quarter of the year, as export gains sharply eased amid the global economic uncertainty.
Asia's fourth-largest economy grew 0.8 percent in the April-June period, slowing from a 1.3 percent on-quarter expansion tallied in the first quarter.
But exports surged 27.3 percent on-year to a new monthly high of US$51.4 billion in July amid heightened uncertainties over the U.S. economy.
Concern over the U.S. economic slowdown is also spurring speculation the U.S. Federal Reserve will start another stimulus program. However, the finance ministry doesn't agree.
"The current inflation rate in the U.S. is very high given its economic expansion, so it is hard to see it moving in that direction," said another official at the ministry, asking not to be named.
