In the third quarter, GDP expanded 1.6% over the same period last year, the slowest pace recorded since Q3 2009. The reading was below the revised 2.3% increase tallied in the previous quarter (previously reported: +2.4% year-on-year) and missed market expectations of a 1.9% growth rate. The quarterly reading reflected a moderation in the contribution from the external sector to overall economic growth as global headwinds weigh on exports. Total consumption increased 1.9% annually in Q3, up from the 1.7% rise recorded in the previous quarter, as private consumption strengthened compared to the previous quarter. Meanwhile, gross fixed investment dipped 2.0% in the third quarter, virtually unchanged from the 2.1% contraction seen in the second. Meanwhile, the external sector's net contribution to overall growth fell from plus 1.5 percentage points in Q2 to plus 1.0 percentage points in Q3, as exports decelerated while imports improved somewhat. Exports of goods and services increased 2.6% annually (Q2: +3.2% yoy), while imports rose 0.9% (Q2: +0.5% yoy). A quarter-on-quarter comparison corroborates the slowdown suggested by the annual data. The economy expanded 0.2% over the previous quarter in seasonally adjusted terms, below the 0.3% expansion recorded in the second quarter.
Economic growth slows to lowest level in three years
October 26, 2012
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Korea GDP Chart
Note: Year-on-year changes of GDP in %.
Source: KOSTAT-KOSIS and FocusEconomics calculations.
Korea Economic News
October 13, 2016
At its 13 October monetary policy meeting, the Bank of Korea (BoK) announced that it will hold the base rate constant at a record low of 1.25%, which was largely in line with market expectations.
October 5, 2016
In September, consumer prices rose 0.6% over the previous month, which contrasted the 0.1% decrease in August and overshot the 0.2% increase the markets had expected.
October 3, 2016
Korea’s Customs Services reported that exports totaled USD 40.9 billion in September, which represented a 5.9% contraction over the USD 43.4 billion recorded in the same month last year.
September 30, 2016
The forward-looking business confidence indicator (BSI) for the manufacturing sector produced by the Bank of Korea (BoK) rose from 74 points in September to 75 points in October.
September 30, 2016
In August, industrial production accelerated and expanded 2.3% year-on-year, which was up from both the 1.6% increase registered in July and the 1.6% rise the markets had expected.