OECD Lowers South Korea's Economic Outlook for This Year from 2.3% to 2.2%

The Organisation for Economic Co-operation and Development (OECD) has revised South Korea's economic growth rate for this year downward from the 2.3% forecast made last November to 2.2%. The consumer price inflation forecast remains unchanged at 2.7%, the same level as last November.

On the 5th, the OECD released its "Interim Economic Outlook" containing these details.

The Korean economy is expected to grow by 2.2% this year and 2.1% next year. The growth forecast for this year was adjusted downward compared to the November forecast (2.3%), but the government evaluated this by stating, "The OECD's growth forecast for Korea this year reflects and converges with our government's economic policy direction forecast of 2.2% for this year."

Korea's inflation rate is expected to remain in the 2% range, at 2.7% this year and 2.0% next year, maintaining the November forecast.

The global economic growth rate is projected to decline to 2.9% this year from 3.1% last year. This is due to macroeconomic policy constraints in major advanced countries and structural burdens on the Chinese economy. However, this is an upward revision compared to the 2.7% forecast made last November.

The United States is expected to grow by 2.1% this year, supported by real wage increases due to easing inflation and interest rate cuts. This is a significant increase from the 1.5% forecast made last November. The Eurozone is expected to grow by 0.6% this year, showing weak growth in the first half due to demand reduction from tightening policies. This is a downward revision from the 0.9% forecast last November.

China is expected to grow by only 4.7% this year due to constrained consumer sentiment, inadequate social safety nets, high debt, and asset market contraction, maintaining the forecast from last November. Japan's growth forecast for this year is 1.0%, unchanged from the November forecast.

The OECD identified major global economic risk factors as geopolitical risks in the Middle East and elsewhere, the potential for rising inflation due to these risks, and debt burdens caused by high interest rates.

It also advised cautious monetary policy considering inflationary pressures and securing fiscal soundness through tax and expenditure reforms.

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