Beijing - XINHUA
South Korea\'s economic sluggishness eased recently due to a rebound in exports to China and Southeast Asian countries, the central bank said Friday. \"The domestic economy continued its low growth trend that lasted since the second quarter, but the economic slump eased recently\" Bank of Korea (BOK) said in its assessment over economic conditions at home and abroad. The central bank said that economic indicators related to production, consumption and investment turned into positive growth in September on an on-month basis thanks to the end of one-off factors such as labor strikes by major carmakers and a series of typhoons. Exports, which account for around half of the South Korean economy, logged positive growth in October, the first rebound in four months due to a rise in exports to China and Southeast Asian nations, the bank said. The assessment came after the BOK froze its policy rate at 2.75 percent at the November rate-setting meeting after cutting the rate by 25 basis points (bps) in the previous month. The BOK forecast that the domestic economy will likely show modest recovery going forward due to additional quantitative easing by major economies and the expected stimulus measures by China, but it warned that negative output gap in the domestic economy will persist for a considerable period of time due to the prolonged euro-area fiscal crisis and the delayed global economic recovery. The output gap, or the GDP gap, refers to the difference between potential GDP and actual GDP. It is calculated by actual output minus potential output. The negative output gap means actual GDP growth stays below the one for potential GDP. The bank said that the global economy show a very modest recovery, noting that downside risks to the growth path would predominate due to the eurozone fiscal crisis and the U.S. fiscal austerity problems. Touching on inflation, the BOK noted that consumer price inflation would stay at the current level for the time being due to eased demand-side pressures that will offset instabilities in international grain prices. The country\'s consumer prices rose 2.1 percent in October from a year earlier.