SEOUL: South Korea’s central bank said on Monday its economic growth projection for 2025 was estimated between 1.6% and 1.7%, lower than the 1.9% it forecast in November.
The cut of around 0.2 percentage points is due to political uncertainty triggered by President Yoon Suk Yeol’s short-lived Dec. 3 martial law attempt and weakening domestic demand amid frail economic sentiment, the Bank of Korea said in a blog post.
Bank of Korea governor says monetary easing this year will be flexible
Last year, Asia’s fourth-largest economy likely grew 2.0% or 2.1%, lower than a 2.2% expansion seen two months ago, also affected by a Dec. 29 plane crash that was the deadliest on South Korean soil, according to the central bank.
South Korea’s economic trajectory will greatly rest on when the current political uncertainty is resolved, government stimulus measures and the economic policies of the incoming U.S. administration, the BOK said.
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