May 04, 2023 10:30
S&P Global Ratings on Wednesday slashed Korea's growth outlook to 1.1 percent, the lowest of all forecasts by major ratings firms, down from 1.4 percent last December.
S&P cited sluggish demand for chips and sky-high household debt.
Park Jun-hong, an analyst at S&P, predicted that the microchip industry will not significantly improve until the second half of this year.
Korea has the third highest household debt-to-GDP ratio in the world. Kim Eng Tan at S&P said, "Every country has a different debt-sustaining capacity. Just because you have the third-highest debt doesn't mean that your country is the third-riskiest in the world." But he added more spending on interest payments could affect the growth momentum of domestic consumption.
Last month, the International Monetary Fund also slashed its outlook for Korea to 1.5 percent, the fourth cut in a row.
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