IMF ON S. KOREA’S GROWTH OUTLOOK

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The IMF has modified its economic outlooks for this and next year. The organization has slashed the 2021 growth outlook for the global economy, but maintained its projection for the Korean economy at over 4 percent.

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In a revised outlook for the global economy, the IMF predicted the South Korean economy will expand 4.3 percent this year. It's the same level as July and the highest among the forecasts by various organizations including the OECD and the Bank of Korea. The IMF downgraded the global economic forecast by 0.1 percentage points from July to 5.9 percent, but maintained its projection for South Korea. The South Korean government attributes this to the vaccination rate, strong export growth and the supplementary budgets. More than 70 percent of the population received the first dose of Covid-19 vaccines as of September. The nation's exports have been expanding since Q4 last year. Economic outlooks for the world's major economies have been slashed from July. The U.S. economy is now projected to grow 6 percent, 1 percentage point less from the previous forecast. Japan: only 2.4 percent, down 0.4 percentage points. China: cut by 0.1 percentage points to 8 percent. The IMF lowered the forecast for Korea for 2022 by 0.1 percentage points to 3.3 percent. The global economy is predicted to grow 4.9 percent next year, the same forecast as in July. The organization believes expansion in vaccine supply will play out as a positive factor for the world economy, whereas the spread of virus variants could undermine it. The IMF warns countries against monetary tightening until inflationary pressures become clear. But it added if the economy recovers sooner than expected, monetary policies should be normalized quickly.