Consumption in Korea
Korea - Consumption
Economic growth improves moderately in Q4
According to a preliminary reading, GDP growth increased slightly to 4.1% year-on-year in the fourth quarter, from 4.0% in the third quarter.
Private consumption increased 6.3% in the fourth quarter, coming in above the third quarter's 3.3% expansion. Meanwhile, government consumption grew at the fastest pace in over a decade, expanding 8.1% (Q3: +6.5% yoy). That said, fixed investment growth fell to an over two-year low of 1.1% in the fourth quarter (Q3: +1.5% yoy).
On the external front, exports of goods and services growth fell to 6.1% in Q4, marking the worst reading since Q1 2021 (Q3: +7.2% yoy). Conversely, imports of goods and services growth picked up to reach 9.7% in Q4 (Q3: +6.6% yoy). Overall, the external sector subtracted 0.8 percentage points from the headline figure in Q4.
On a seasonally-adjusted quarter-on-quarter basis, economic growth accelerated to 1.1% in the fourth quarter, compared to the previous quarter's 0.3% expansion. Q4's reading marked the fastest increase since Q1 of last year. Taken together, the economy grew 4.0% in 2021, rebounding from the 0.9% contraction in 2020.
Commenting on the outlook, Ho Woei Chen, economist at United Overseas Bank, said:
“The sustained growth recovery in Q4 2021 despite a pick-up in domestic Covid-19 infections in December supports a positive outlook this year. We are likely to see a more moderate impact from any resurgence in infections as countries adopt an endemic approach to live with Covid-19, given that vaccination rates have reached high levels in many countries. […] Overall, we see robust external demand (in particular for technology products), gradual recovery in private consumption as well as government support measures to keep South Korea’s growth at an average of 3.0% in 2022, in line with Bank of Korea (BOK)’s and our forecasts. Uncertainties that need to be watched include more contagious Covid-19 variants, growth slowdown in China, withdrawal of monetary accommodation by global central banks and the upcoming presidential election.”
FocusEconomics panelists see the economy growing 3.0% in 2022, which is unchanged from last month’s forecast. For 2023, they see the economy growing 2.6%.
Korea - Consumption Data
|Consumption (annual variation in %)||2.2||2.6||2.8||3.2||1.7|
5 years of economic forecasts for more than 30 economic indicators.
|Bond Yield||1.68||1.55 %||Dec 31|
|Exchange Rate||1,156||0.21 %||Dec 31|
Get a sample report showing our regional, country and commodities data and analysis.
Request a Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
April 14, 2022
At its meeting on 14 April, the Bank of Korea (BOK) raised the base rate by 25 basis points to 1.50%.
April 5, 2022
Consumer prices increased 0.72% in March over the previous month, accelerating from the 0.58% rise seen in February.
April 1, 2022
The S&P Global Manufacturing Purchasing Managers' Index (PMI) came in at 51.2 in March, down from February's 53.8.
April 1, 2022
Merchandise exports jumped 18.2% in annual terms in March (February: +20.7% year-on-year).
March 31, 2022
Industrial output rose 3.9% compared to the same month a year earlier in February in seasonally-adjusted terms, which followed January's 6.6% increase.