S.Korea economy grows 0.7 pct in Q3, revised figure confirms

Friday, 3 December 2010 00:45 - - {{hitsCtrl.values.hits}}

SEOUL, (AFP) - South Korea's economy grew 0.7 percent in the third quarter compared to three months earlier, the same pace as earlier predicted, the central bank said Thursday.

South Korean President Lee Myung-Bak (C) presides over a meeting to take measures to cope with national economy at the presidential Blue House in Seoul December 2, 2010. The words in the background read, “Let's take crisis as opportunity!” REUTERS

The Bank of Korea said gross domestic product rose 4.4 percent year-on-year in July-September compared to its earlier estimate of 4.5 percent.

Quarter-on-quarter growth fell from 1.4 percent in April-June, indicating that Asia's fourth largest economy has slowed down following a fast recovery.

Exports grew 1.9 percent quarter-on-quarter in July-September, matching previous estimates. Private spending expanded 1.3 percent, also the same pace as predicted.

Some analysts expect a contraction in fourth-quarter growth, and full-year growth below the central bank's 6.0 percent forecast.

“The leading composite economic index, a good indicator of GDP one or two quarters forward, fell month-on-month in October for the first time in April,” Nomura economist Kwon Young-Sun told Dow Jones Newswires.

“In addition, uncertainty over capital control measures and elevated geopolitical risks are likely to mean more financial market volatility in the fourth quarter, which could also add downside risk to growth, especially in business sentiment.”ING's Tim Condon said recent data pointing to an economic slowdown may shift the balance of risks for the central bank to growth from inflation.