Released on - Monday,26 July , 2010 -02:53 21
South Korea's economy grew 1.5 percent in the second quarter from three months earlier and 7.2 percent year-on-year, the central bank said Monday, in new signs of a solid recovery.
For the whole of the first half, gross domestic product grew 7.6 percent from the previous year, the Bank of Korea said in an advance estimate.
"Private spending showed solid growth (in the second quarter) and facility investment and overseas shipments of goods sharply expanded," the central bank said in a statement.
However, growth in April-June slowed from the first quarter on lower government stimulus spending. The economy had grown a revised 2.1 percent quarter-on-quarter in January-March, and 8.1 percent year-on-year.
The bank said manufacturing grew further in the second quarter from the previous quarter, but the construction sector recorded a decline due to a big fall in new home construction.
Government spending rose just 0.1 percent quarter-on-quarter in April-June compared to a 5.8 percent rise in January-March.
Construction investment fell 3.4 percent following a 1.3 percent rise in the first quarter.
But exports jumped 7.1 percent quarter-on-quarter in April-June after expanding 3.7 percent in the first quarter.
Private spending rose 0.8 percent compared with a 0.7 percent gain in the preceding quarter.
Capital investment increased 8.1 percent after advancing 2.4 percent in the first quarter.
Asia's fourth largest economy has been recovering fast from the global slowdown thanks to healthy exports and local consumption.
This month the central bank in a surprise move increased the key interest rate by 25 basis points from a record low -- the first rise since late 2008.
But bank governor Kim Choong-Soo said at the time that any subsequent rise would be done without hurting growth and would be within market expectations.
For the whole of this year the bank forecasts 5.9 percent growth, following a 0.2 percent increase last year.
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