IMF-S Korean economy
IMF cuts S. Korean economy's growth outlook to 1.4 pct
By Kang Yoon-seung
SEOUL, July 25 (Yonhap) -- The International Monetary Fund (IMF) on Tuesday slashed its 2023 economic growth outlook for South Korea to 1.4 percent amid "persistent challenges" in the global economy.
It marked a 0.1 percentage point drop from the Washington-based organization's estimate of 1.5 percent released in April.
The figure comes in line with the South Korean government and the Bank of Korea's (BOK) latest projection of 1.4 percent economic growth for 2023.
Last week, the Asian Development Bank lowered its growth outlook for the South Korean economy by 0.2 percentage point to 1.3 percent as well.
The IMF maintained its growth outlook for South Korea for 2024 at 2.4 percent.
Asia's No. 4 economy has been facing uncertainties from home and abroad, including global monetary tightening moves, along with weak exports.
South Korea's real gross domestic product -- a key measure of economic growth -- increased 0.6 percent on-quarter in the April-June period, accelerating from a 0.3 percent expansion in the first quarter, according to an advance estimate from the Bank of Korea.
The pickup in the growth rate came as imports fell at a faster pace than exports in the second quarter.
Exports declined 1.8 percent on-quarter in the second quarter, as the weaker performance of petroleum products offset gains from chips and automobiles. Imports fell by 4.2 percent over the same period, led by crude oil and natural gas.
Earlier this month, the BOK kept its key interest rate unchanged at 3.5 percent for the fourth straight time. The central bank delivered seven consecutive rate hikes from April 2022 to January 2023.
The IMF, meanwhile, revised up its growth outlook on the global economy for this year by 0.2 percentage point to 3 percent. The adjustment comes in response to the recovery in the service sector on the back of post-pandemic tourism.
The institution also attributed the improved outlook on the abated U.S. debt ceiling woes and the eased concerns over the crisis in the banking sector.
The organization, however, said the global economy is still facing lingering challenges despite "near-term resilience," noting countries around the globe should maintain monetary tightening policies.
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