BOK Revises Q2 GDP Growth Rate Upward... -3.3% to -3.2% (Update)

[Image source=Yonhap News]

[Asia Economy Reporter Eunbyeol Kim] The preliminary real Gross Domestic Product (GDP) growth rate for the second quarter of this year was revised upward by 0.1 percentage points to -3.2%, compared to the flash estimate of -3.3% announced in July.

On the 1st, the Bank of Korea revised the second quarter GDP growth rate from -3.3% to -3.2% in its announcement of the "2020 2nd Quarter National Income (Preliminary)." Accordingly, the growth rate for the second quarter, which was the lowest since the Asian Financial Crisis (Q1 1998, -6.8%) at the time of the flash estimate announcement, became the lowest since the Global Financial Crisis (Q4 2008, -3.3%) after the revision.

Private consumption increased by 1.5% due to a rise in durable goods such as passenger cars and home appliances, and government consumption increased by 1.1%, mainly driven by spending on goods. Construction investment decreased by 1.5% due to a decline in building construction, and facility investment fell by 0.5% as machinery increased but transportation equipment decreased. Exports decreased by 16.1% due to declines in automobiles and mobile phones, while imports fell by 6.7%, mainly due to crude oil.

This preliminary growth rate is calculated using all indicators from April to June, unlike the flash estimate which was based on surveys from April to May.

The nominal GDP growth rate, which reflects price changes, recorded -1.0%. Compared to the decline in real GDP growth rate, the nominal GDP growth rate's decline narrowed compared to the first quarter (-1.6%). However, the nominal Gross National Income (GNI) for the second quarter decreased by 1.2% quarter-on-quarter, slightly underperforming the nominal GDP growth rate.

The real GNI growth rate was -2.2%, exceeding the real GDP growth rate (-3.2%) due to improvements in terms of trade.

With the improvement in nominal GDP growth rate, the GDP deflator (nominal GDP/real GDP) rose by 1.2% year-on-year. This is the first time in six quarters since Q4 2018 that the GDP deflator recorded a positive figure.

This content was produced with the assistance of AI translation services.