South Korean economic growth expands above expectations in Q4, outlook remains challenging

South Korea’s economic growth came in above market expectations in the fourth quarter. The economy grew 1 percent on a quarter-on-quarter basis, while it expanded 3.1 percent year-on-year.  Export growth disappointed in the quarter, falling 2.2 percent sequentially on weakening external demand, government consumption helped to prop up the economy.

President Moon promises to increase the attempt to stimulate the job market. Nevertheless, as the bellwether economy which greatly relies on external demand, the South Korean economic outlook continues to remain challenging in 2019, especially considering that China’s economy is likely to decelerate further in 2019, said Commerzbank in a research report.

“As such, it makes sense to expect KRW to soften somewhat over the foreseeable future”, added Commerzbank.