S.Korea downgrades this year’s growth target to 2-2.1%

20 Oct 2019 / 15:08 H.

SEOUL: South Korea's finance minister said economic growth this year is expected to be around 2.0-2.1%, in line with projections by key international organisations but missing the ministry's target set in early July.

"I think this year's economic growth will be around the level of forecasts seen by the International Monetary Fund (IMF) and Organisation for Economic Cooperation and Development (OECD)," Finance Minister Hong Nam-ki told reporters on Friday at a media briefing on the sidelines of G20 meeting in Washington.

In its regular update on the global economic outlook released late on Tuesday, the International Monetary Fund slashed South Korea's 2019 and 2020 economic growth forecasts by 0.6 of a percentage point each to 2.0% and 2.2%, respectively.

The OECD in mid-September also trimmed the nation's growth estimate to 2.1% and 2.3% for this year and next year due to a slowdown in global trade and cooling demand from China.

South Korea's finance ministry said in its mid-year update of economic forecasts in early July that it aims to achieve growth between 2.4% and 2.5% this year, slower than the 2.6-2.7% range projected in its previous forecast in December last year.

South Korea's central bank cut its policy interest rate on Wednesday for the second time in three months to lift the faltering economy, hit by cooling global demand and the prolonged U.S.-China tariff war.

The Bank of Korea said it expects the economy to grow less than its July projection of 2.2%, "owing chiefly to the continued U.S.-China trade dispute and heightened geopolitical risks."

The economy grew 1.9% year-on-year in the first half of this year, and full year growth in 2018 was 2.7%. The central bank is scheduled to release third quarter gross domestic product estimates on Thursday. - Reuters

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