South Korea continues to see its recovery momentum remain "subdued" but the latest indicators are pointing to a "moderate" improvement down the road, a state-run think tank said Thursday.
"Korea's economy remained subdued, but indicators are increasing turning positive, signaling a moderate improvement," the Korea Development Institute (KDI) said in its monthly report analyzing the latest economic trend.
The report is based on major indicators recently unveiled by the government including corporate investment, exports, employment and consumer prices along with the financial market conditions at home and abroad.
The report said that retail sales still remained weak, while facility investment by businesses stayed on the downward path, pointing to overall sluggish domestic demand.
Exports, meanwhile, are posting a "gradual" improvement mainly thanks to expanded shipments bound for the U.S. and China, the report noted.
As possible risks for South Korea, the KDI cited the instability of markets in emerging economies such as India and Indonesia, but the market here has so far remained relatively stable.
"Financial markets in Korea remained stable despite uncertainties across financial markets in some emerging countries caused by the possibility of the U.S. quantitative easing reduction," the think tank said.
"Unlike India and Indonesia, Korea's current account and consolidated government balance have run a surplus, the debt to foreign exchange reserves ratio is not high and asset prices exhibit few signs of a bubble," it added. (Yonhap News)
