Overseas IBs Lower Growth Forecast for Korea Again... 8 Firms Average 1.55%

Down 0.09 Percentage Points from 1.64% at the End of January
Average Inflation Forecast Rises from 1.86% to 1.90%

Global investment banks (IBs) have once again lowered their expectations for South Korea's economic growth rate this year.

Following President Donald Trump's signing of a proclamation imposing a 25% tariff without exceptions on steel and aluminum products imported into the United States, and his announcement that tariffs on automobiles and semiconductors are also under consideration, export vehicles were waiting to be loaded at Pyeongtaek Port, Gyeonggi Province, on the 13th of last month.

According to the International Financial Center on the 6th, the economic growth rate forecast for South Korea this year, presented by eight major overseas IBs, stood at 1.55% as of the end of last month, down 0.09 percentage points from 1.64% at the end of January. This is close to the 1.5% revised economic outlook presented by the Bank of Korea last month.

The IBs that lowered their forecasts last month were Bank of America, Nomura, and Citi. They adjusted their forecasts downward from 1.8% to 1.5%, 1.7% to 1.5%, and 1.4% to 1.2%, respectively. UBS (1.9%), Goldman Sachs (1.8%), HSBC (1.7%), Barclays (1.6%), and JP Morgan (1.2%) maintained their forecasts from a month ago.

Last month, the UK research institute Capital Economics (CE) also lowered its growth rate forecast for South Korea this year from 1.1% to 1.0%.

Regarding this year's consumer price inflation forecast, Citi raised its estimate from 1.9% to 2.0%, and Nomura from 1.8% to 2.0%. As a result, the average increased slightly from 1.86% at the end of January to 1.90% at the end of February. JP Morgan and HSBC each maintained 2.0%, Barclays and UBS each held 1.9%, Bank of America stayed at 1.8%, and Goldman Sachs remained at 1.6%. The Bank of Korea's forecast is 1.9%.