South Korea Economy Expands 0.8% QoQ in Q1


The South Korean economy advanced by 0.8 percent on quarter in the first three months of 2015, accelerating from a 0.3 percent expansion in the previous period, mainly due to a rebound in investment and a slight increase in consumption.

On the expenditure side, gross fixed capital investment expanded by 4.1 percent, following a 2.9 percent contraction in the December quarter, according to preliminary estimates. Construction investment grew by 7.5 percent, rebounding from a 7.8 percent contraction in Q4 of 2014. Intellectual property products grew by 2.6 percent, after registering a 0.5 percent contraction in the preceding quarter. Meanwhile, facilities investment were flat, as compared to 4 percent expansion in the previous period. Final consumption expenditure advanced by 0.5 percent, following a 0.4 percent growth in the last quarter of 2014. Private consumption expanded by 0.6 percent, following a  0.5 percent growth in Q4. Government consumption grew 0.2 percent, the same pace as in the proceeding period. Exports were flat, following a 0.4 percent rise in the preceding quarter. Imports rose by 0.5 percent, slowing from a 0.7 percent increase in the previous period.

On the production side, all sectors showed an expansion except the electricity, gas & water supply sector. The construction sector expanded by 2.5 percent, rebounding from a 3.0 percent contraction in the December quarter, as residential building construction increased. The services sector grew by 0.9 percent, after registering a 0.6 percent growth in the previous quarter, as all sub-sectors expanded. The manufacturing sector advanced by 0.4 percent from a 0.0 percent growth in the preceding quarter, as production of semiconductors and petrochemicals expanded. The agriculture sector grew by 2.9 percent from 2.8 percent in Q4, mainly due to an increase in the production of vegetables and fruits. In contrast, the electricity, gas & water supply declined by 3.6 percent, following a 4.9 percent expansion in the preceding quarter, mainly due to electricity.

Year-on-year, the GDP advanced 2.4 percent in the first quarter of 2015, down from a 2.7 percent expansion in the last quarter of 2014. It was the smallest growth rate in almost 2 years.

South Korea Economy Expands 0.8% QoQ in Q1


Bank of Korea l Rida Husna l rida@tradingeconomics.com
4/23/2015 12:36:19 PM