Roundup: S. Korea's real GDP grows 0.6 pct on quarter in Q2

Alsharq Tribune-AFP

South Korea's real gross domestic product (GDP), adjusted for inflation, grew 0.6 percent in the second quarter compared to the previous quarter thanks to a recovery in consumer spending and export, data from the central bank showed Thursday.

The seasonally-adjusted real GDP rebounded in the April-June quarter after contracting 0.2 percent in the previous quarter, according to the Bank of Korea (BOK).

The turnaround was attributable to the rebound in private consumption and outbound shipment.

Export, which accounts for about half of the export-driven economy, jumped 4.2 percent in the second quarter from three months earlier after reducing 0.6 percent in the first quarter on the back of higher demand for semiconductors and oil products.

Import expanded 3.8 percent in the second quarter, turning around from a decrease of 1.1 percent in the previous quarter.

Private consumption, another growth engine of the Asian economy, swelled 0.5 percent in the second quarter from three months earlier after sliding 0.1 percent in the prior quarter.

Fiscal spending increased 1.2 percent in the April-June quarter, but facility investment diminished 1.5 percent owing to weaker demand for machinery and transport equipment.

Construction investment declined 1.5 percent in the cited quarter, keeping a downward trend for the fifth successive quarter amid the still faltering real estate market.

The BOK slashed this year's growth outlook for the South Korean economy to 0.8 percent in May from 1.5 percent estimated three months earlier.

The sharp downward revision came amid lingering uncertainties such as the U.S. tariffs imposition and the sluggish domestic demand.

The central bank lowered its benchmark interest rate by 25 basis points in February and May to 2.50 percent after cutting it by the same basis points in October and November last year.

The Lee Jae-myung government, which was inaugurated on June 4, began to implement its supplementary budget this month to bolster the sagging domestic demand.

By industry, the seasonally-adjusted production among manufacturers advanced 2.7 percent in the second quarter on a quarterly basis after slipping 0.6 percent in the previous quarter.

Output in the service industry gained 0.6 percent in the cited quarter on an upswing in the transport and the property sectors.

Production in the construction industry decreased 4.4 percent in the quarter, continuing to go down for five straight quarters, with those for the agriculture, fishery and forestry and the electricity, gas and water sectors retreating 1.4 percent and 3.2 percent each.

Real gross domestic income rose 1.3 percent in the April-June quarter after falling 0.6 percent in the prior quarter.