SEOUL, South Korea (AP) — South Korea’s economy grew at a slower annual pace during the last quarter as slumping domestic investment negated modest gains in consumption and exports, the Bank of Korea said Thursday.
Asia’s fourth largest economy grew at a 2.0 percent annual pace in July-September, down from 2.8 percent in the previous quarter, it said.
The central bank last week cut its economic growth forecast for the year to 2.7 percent from 2.9 percent, citing sluggish investment and job creation and risks posed by trade tensions between the United States and China.
South Korea has struggled to improve a decaying employment outlook and tame notoriously high house prices that have contributed to rising household debt that is discouraging consumer spending and construction.
The Bank of Korea said activity in the construction sector investment shrank 6.4 percent from the April-June period, the biggest quarterly decline since 1998 when the country was in the midst of the Asian financial crisis. Corporate investment fell 4.7 percent from the second quarter.
Exports during July-September grew 3.9 percent on a quarterly basis thanks to strong demand for semiconductors. But private consumption, which accounts for almost half of the country’s annual GDP, expanded a mere 0.6 percent from the second quarter.
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