Bloomberg News

South Korea’s Growth Exceeds Estimates Even as Won Caps Exports

October 24, 2013

South Korea’s economic growth exceeded economists’ estimates even as gains in the won weighed on the country’s exports.

Gross domestic product rose 1.1 percent in the July-September period from the previous quarter, matching the increase in April-through-June, the Bank of Korea said today in a statement in Seoul. That was above the median 0.8 percent estimate of 15 economists surveyed by Bloomberg News. From a year earlier, growth was 3.3 percent.

South Korea’s finance ministry yesterday warned that it would take action if necessary to counter “herd behaviour” in the currency market. The won rose about 8 percent against the dollar since the end of June, the biggest gain in Asia, and about 6 percent against the yen, Bloomberg data show.

“The economy is pretty in good shape with steady growth,” Park Sang Hyun, chief economist at HI Investment and Securities Co. in Seoul, said before the release. “Policy makers may try to stem the won’s further advance before it saps growth momentum.”

President Park Geun Hye introduced a 17.3 trillion won ($16 billion) extra budget in May, the same month the Bank of Korea delivered a surprise interest-rate cut, seeking to bolster an economy that grew 2 percent in 2012, the slowest in three years.

Today’s data showed a 0.6 percent decline in exports from the previous three months, while private consumption and facility investment rose.

To contact the reporter on this story: Eunkyung Seo in Seoul at eseo3@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst at ppanckhurst@bloomberg.net


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