Moody's: "South Korea's Q2 Economic Contraction Will Be Larger Than Q1"

[Asia Economy Reporter Kim Eun-byeol] Moody's Analytics, a subsidiary of the international credit rating agency Moody's, stated on the 27th that South Korea's economic growth rate, which recorded a negative (-) in the first quarter, is expected to worsen in the second quarter.

In a report covering the economic outlook of countries in the Asia-Pacific region, Moody's Analytics analyzed, "The degree of economic slowdown in South Korea in the second quarter is expected to be more severe than in the first quarter, with the quarter-on-quarter decrease in Gross Domestic Product (GDP) possibly exceeding 1.5%."

On the 23rd, the Bank of Korea announced that the first quarter GDP decreased by 1.4% compared to the previous quarter, but Moody's expects the decline to be larger in the second quarter.

Moody's Analytics pointed out, "In the first quarter, South Korea's economy was supported by a noticeable increase in government consumption and investment, but short-term risks continue to rise."

They added, "South Korea's exports in April are expected to decrease by up to 8.5% compared to the same period last year, and imports are expected to decrease by up to 5%. With the rapid spread of COVID-19 in the United States and Europe, South Korea's trade demand, which is highly dependent on exports, is expected to decline."

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