The Bank of Korea: "Global Economy Rebounds in Q3, Improvement Pace Slows in Q4"

[Asia Economy Reporter Kim Eun-byeol] The Bank of Korea forecasted that the global economic growth rate will rebound significantly in the third quarter, but the pace of improvement will gradually slow down as it enters the fourth quarter.

On the 18th, the Bank of Korea stated in the 'Overseas Economic Focus' report, "The global economy will continue to improve supported by the maintenance of expansionary policy stances; however, until a COVID-19 vaccine and treatment are developed, the recent moderate recovery trend is expected to persist."

Recently, the economy has been recovering from the downturn faster than expected due to consumption recovery and investment expansion in advanced countries, which also contributed to the export improvement of emerging countries with a high proportion of exports to China or consumer goods.

However, it diagnosed the current situation by saying, "Due to the continued sluggishness in service consumption caused by the COVID-19 pandemic, employment and income improvements remain insufficient, and the recovery of investment and trade is delayed, making it difficult to enter a full-fledged recovery phase."

Therefore, the Bank of Korea expects the global economic growth rate to rebound significantly in the third quarter compared to the previous quarter, but the pace of improvement will gradually slow down in the fourth quarter. In particular, goods consumption is expected to increase steadily, but service consumption is unlikely to improve significantly until vaccines or treatments are available.

Furthermore, it added, "Due to the continued high uncertainty surrounding COVID-19, sluggish corporate investment, especially in the non-IT sector, will continue for the time being," and "Because of sluggish corporate investment, export recovery is delayed in advanced countries, unlike in emerging countries." It also stated, "Going forward, consumer goods exports will steadily increase following the recovery of goods consumption, but for global trade conditions to improve, the recovery of capital goods trade is necessary."

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