South Korean Economy Advances Less than Expected


The South Korean GDP expanded a seasonally adjusted 0.5 percent in the second quarter of 2014 compared with the previous period. Final estimates came below the advance 0.6 percent expansion, as investment and exports grew less than anticipated.

On the expenditure side, private consumption contracted by 0.3 percent, as expenditures on both gods and on services declined. 

Facilities investment expanded by 1.1 percent, lower than a 1.3 percent initial estimate and led by increased investment in transport equipment. Construction investment grew at a slower 0.4 percent (0.6 percent initially estimated) despite a decline in civil engineering, as building construction expanded. Intellectual property products investment fell less than expected (3.6 percent compared with an initial estimate of 4.2 percent), owing to contractions in R&D investment in the private sector.

Exports grew at a slower 1.7 percent, with increases in exports of LCD and chemical products. Imports rose more than anticipated by 1.1 percent, owing to expansions in those of vehicles and in overseas consumption by residents.

On the production side, manufacturing expanded by 0.9 percent, on increases in the production of chemical and LCD products. Construction increased by 0.2 percent, centering around building construction. Services saw growth of 0.6 percent, despite declines in restaurant & hotels, transportation & storage, as health & social work and business activities increased.

Year-on-year, the GDP advanced 3.5 percent in the second quarter of 2014, down from a 3.6 percent advance estimate.

South Korean Economy Advances Less than Expected


Bank of Korea l Joana Taborda l joana.taborda@tradingeconomics.com
9/4/2014 10:44:21 AM