South Korea posted its lowest economic growth in five quarters in the three months to March, the central bank said yesterday, blaming slow consumer spending.
The Bank of Korea said GDP grew 0.8 percent quarter-on-quarter for the January-March period, slightly up from the 0.7 percent it projected earlier.
The revised figure marks the slowest expansion since the fourth quarter of 2006 when growth also stood at 0.8 percent, the bank said.
The bank said GDP growth was 5.8 percent year-on-year in the first quarter, up from its previous estimate of 5.7 percent.
The economy expanded faster than earlier estimated on brisk exports, but falling real income and rising inflation dampened demand at home, it said.
The country’s real gross national income, which reflects the population’s actual purchasing power, dipped 1.2 percent in the first quarter — the biggest drop since the first quarter of 2003, it said.
The nation’s inflation also hit the highest level in almost seven years last month on increased fuel costs, breaching the target range for the sixth straight month, official data showed.
The consumer price index jumped 4.9 percent last month from a year earlier, the highest rise since a 5 percent gain in June 2001, the National Statistical Office said.
The Bank of Korea predicts inflation is likely to stay far above its target this year because of high oil prices and a weak won.
The bank’s inflation target range is 2.5 percent to 3.5 percent for this year. But annual inflation has been above 3.5 percent since December.
In better news, South Korea posted a trade surplus of more than US$1 billion last month to end a run of deficits, helped by a surge in exports of ships, the government said yesterday.
The trade surplus reached US$1.04 billion last month as export growth offset a soaring oil import bill, the official figures showed. The trade balance was in deficit to the tune of US$190 million in April.
Exports surged 27.2 percent year-on-year to US$39.49 billion last month.
Shipbuilders enjoyed record sales of US$4.9 billion last month and other exporters also benefited from a weaker won, the Ministry of Knowledge Economy said in a statement.
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