South Korea GDP Climbs 1.7% On Quarter In Q1

South Korea’s gross domestic product expanded a seasonally adjusted 1.7 percent on quarter in the first quarter of 2021, the Bank of Korea said on Wednesday.

That follows the downwardly revised 1.1 percent increase in the previous three months (originally 1.2 percent).

On a yearly basis, GDP was up 1.9 percent following the upwardly revised 1.1 percent decline in the three months prior (originally -1.2 percent).

Real gross national income (real GNI) increased by 2.4 percent in the first quarter compared to the previous quarter. On the production side, manufacturing rose 3.8 percent on quarter, mainly due to increases in transportation equipment, computer, electronic & optical products and chemical products. Construction increased 0.9 percent, owing to increases in non-residential building construction and specialized construction.

Services grew by 0.7 percent, led by wholesale & retail trade, accommodation & food services, finance & insurance and education services.

On the expenditure side, private consumption rose by 1.2 percent, as expenditures on durable goods and services increased. Government consumption rose by 1.6 percent, mainly due to increased expenditures on goods. Construction investment rose by 1.3 percent, as building construction increased. Facilities investment grew by 6.1 percent, led by the growth of investment in machinery and transportation equipment. Exports increased by 2.0 percent, as exports of goods such as motor vehicles and mobile phones expanded. Imports were up by 2.9 percent, owing to increased imports of machinery & equipment and basic metal products.

Nominal GNI rose by 2.3 percent on quarter in Q1, increasing more than nominal GDP (1.9 percent) as net factor income from the rest of the world increased.

Real GNI grew 2.4 percent on quarter, increasing more than real GDP (1.7 percent) owing to increased net factor income from the rest of the world and improved terms of trade. The GDP deflator increased by 2.6 percent on year.

The gross saving ratio (gross saving/gross national disposable income) stood at 37.4 percent, 0.3 percentage points higher than in the previous quarter, as nominal gross national disposable income (2.2 percent) increased more than the final consumption expenditure (1.8 percent). The gross domestic investment ratio (gross capital formation/GNDI) was 31.0 percent, maintaining the level of the previous quarter.

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