SEOUL: South Korea’s central bank on Friday cut its growth forecast citing “deteriorations in economic sentiment” as the country is rattled by the snowballing political turmoil engulfing impeached President Park Geun-Hye. And on Friday the Bank of Korea (BOK) said it expected expansion of 2.5 percent in 2017, down from its earlier projection of 2.8 percent given in October. “The trend of recovery in domestic demand activities is expected to be limited, due to deteriorations in economic sentiment,” it said in a statement. Krystal Tan, a Singapore-based analyst at Capital Economics, said the BOK will likely cut rates to stimulate the sluggish domestic economy. “It is likely to proceed cautiously amid concerns that further rate cuts would encourage Korea’s debt-laden households to increase their borrowing even further,” she said.

Source: Manila Times January 13, 2017 16:06 UTC