Country’s economy will contract 1.3% this year, says South Korea’s central bank

Slashing the country’s growth forecast on August 27, the South Korea’s central bank said that the country’s economy, the 12th largest in the world, will contract 1.3 per cent this year as the country braces for a surge of COVID-19 infections.

Revising down its growth outlook from the estimate of a 0.2 per cent fall that it announced in May, the Bank of Korea said that country would witness its first negative growth since the foreign exchange crisis in 1998 roiled the economy.

“The recovery of domestic economic growth is likely to be slower than previously forecast, largely due to the domestic resurgence of COVID-19. Uncertainties around the future path of GDP growth are also judged to be very high,” the bank said in a statement.

The latest estimates came as the country battles several new Coronavirus clusters.

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