IMF cuts 2023 growth outlook for S. Korean economy to 1.5 pct

IMF-S Korean economy

IMF cuts 2023 growth outlook for S. Korean economy to 1.5 pct

By Kang Yoon-seung

SEOUL, April 11 (Yonhap) -- The International Monetary Fund (IMF) on Tuesday trimmed its 2023 economic growth outlook for South Korea to 1.5 percent amid uncertainties in the global financial market.

It marked a 0.2 percentage-point drop from the Washington-based organization's estimate in January.

The figure is slightly below the projection of 1.6 percent by the Bank of Korea (BOK)in February, although the central bank hinted earlier in the day that the actual growth may be short of its earlier expectations.

In March, the Organization for Economic Cooperation and Development (OECD) also lowered South Korea's growth outlook for 2023 to 1.6 percent.

The IMF also revised down its growth outlook for South Korea for 2024 by 0.2 percentage point to 2.4 percent.

The growth outlook revision came amid growing concerns that aggressive monetary tightening measures in major economies may impede the economic growth around the globe.

Earlier in the day, the BOK held its key interest rate steady at 3.5 percent for the second straight time as inflation appears to be easing and concerns are rising over an economic slowdown.

South Korea's consumer prices, the main gauge of inflation, rose 4.2 percent in March from a year earlier, which was the slowest on-year price rise in a year. They have been on the decline since peaking at a 24-year high of 6.3 percent in July last year.

The IMF expected the global economy to expand 2.8 percent on-year in 2023, down 0.1 percentage point from the previous estimate, pointing out the global economy is set to experience "a rocky recovery" this year.

The organization advised countries to enhance their monitoring of financial market volatility and continue with monetary tightening until inflation subsides.

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