South Korean Economy Slows From Fastest Expansion Since 2015
- GDP expands 0.6% from previous quarter, 2.7% from year earlier
- Slowdown due to fall in export volume, slower construction
South Korea’s economic growth slowed in the second quarter as expansion in construction investment eased and export volumes fell from the previous three months. Economists said the slowdown is mostly due to a base effect from a solid first-quarter performance and that it shouldn’t be seen as a negative sign for the outlook.
South Korea’s economy received a new boost from the parliament’s approval of an extra budget this month, which the government estimates would support the growth rate by 0.2 percentage points, lifting expansion this year 3 percent. While exports have continued to rise by double-digits, consumption has been a weak point. That weakness in spending may change, as private consumption expanded 0.9 percent in the second quarter from the previous three months, the biggest gain since 2015. Consumer sentiment has been soaring with optimism on President Moon Jae-in’s job-promoting policies.