Korea has experienced a continued contraction in domestic demand though rising exports have mitigated an economic slowdown, a state-run think tank said Sunday.”Domestic demand remains sluggish, yet exports are rapidly growing, thereby easing the contraction in economic activity,” the Korea Development Institute (KDI) said in a monthly economic assessment report.”The value of construction completed exhibited a temporary uptick, yet both consumption and equipment investment continue to stagnate under the strain of sustained high interest rates,” it added.Retail sales, a gauge of private spending, advanced 0.8 percent on-month in January, but the figure shed 3.4 percent on an on-year basis, extending its losing run to the seventh consecutive month.Facility investment added 4.1 percent on-year, but the growth was largely attributable to such temporary factors as base effects and additional working days. In a seasonally adjusted on-month term, it fell 5.6 percent.”Domestic demand risks linger; delinquency rates on household and personal business loans have stayed high and certain items, such as agricultural products, are experiencing an increasing inflationary trend due to deteriorating supply-side factors,” the report read.
In contrast with weak consumption and investment, exports have shown a recovery trend driven by solid demand for semiconductors.Exports rose for the fifth consecutive month in February after a yearlong downturn.”Concerns over a global economic downturn and dwindling global trade have eased, and the circumstances act as a supportive factor for exports,” the KDI said.Speaking of inflation, the think tank said that supply-side inflationary pressure intensified to accelerate the growth of consumer prices. But it pointed to the continued easing of underlying inflation.In February, consumer prices, a key gauge of inflation, rose back to over 3 percent in a month to stand at 3.1 percent on high prices of fruits and other farm produce, as well as global oil prices.The government has said that consumer prices are forecast to ease at a slower pace than earlier expected before reaching their target rate of 2 percent by around 온라인카지노 the end of 2024.The finance ministry expected this year’s prices to grow 2.6 percent.