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Korean economy expected to grow 2.5% this year on chip export rebound: BOK

Bank of Korea Governor Rhee Chang-yong speaks during a press conference at the bank headquarters in Seoul, Thursday. Yonhap

The Korean economy is projected to grow 2.5 percent this year on stronger-than-expected exports, buoyed by favorable external conditions, the central bank said, Thursday.The outlook is up from February’s forecast of 2.1 percent.The Bank of Korea (BOK) maintained the key rate at 3.5 percent for the 11th consecutive session, citing persistently high inflation.The central bank revised its growth estimate to 2.5 percent, underpinned by Korea’s unexpected quarter-on-quarter growth of 1.3 percent in the January-March period.

“The economy is expected to improve at a favorablepace, as indicated by strong export growth amid an upturn in the IT sector and the recovery of major economies. The growth trajectory of consumption is likely to show an upward trend,” BOK Governor Rhee Chang-yong said during a press conference at the bank headquarters in Seoul.He said the first-quarter growth, which beat a market estimate of 0.6 percent, was backed by robust net exports, as outbound shipments surged faster with energy imports declining sharply due to warm winter months.But the BOK said second-quarter growth is likely to slow down due to dwindling construction investments, a slowdown in consumption and lower contributions from net exports. “The economy will bounce back in the second half,” Rhee said.The central bank left its inflation forecast at 2.6 percent for this year.“Inflation remains elevated due to stronger growth and the depreciation of the Korean won, but further upward price pressure is mitigated by the extension of a fuel tax cut,” he 슬롯사이트 said.

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