Global rating agency Standard & Poor’s has sharply slashed its growth forecast for South Korea’s economy this year to 2 percent due to rising uncertainty about the global trade outlook and weaker consumption.
The latest estimate represented a sharp downward revision from its previous forecast of 2.4 percent in April.
S&P said high inventories, particularly in the electronics sector, and rising uncertainty about the global trade outlook will continue to weigh down production and private investment.
“We expect growth to slow to 2 percent in 2019, before base effects in the electronics sector help push the headline figure back to 2.6 percent in 2020,” S&P said in the latest Asia-Pacific Quarterly published on Tuesday.
The downward revision came a week after the government cut its economic growth outlook this year to between 2.4 percent and 2.5 percent from its previous forecast of between 2.6 percent and 2.7 percent in December.
By Ram Garikipati and newswires (email@example.com)