Asia’s fourth-largest economy expanded by 0.7% in the second quarter, according to data released by the Bank of Korea on Thursday.
That figure represents a quarter-on-quarter slowdown from Q1, when gross domestic product had grown by 1%, but seen from a year-on-year perspective, it represents 2.9% growth.
Growth was underwritten by a 0.8% rise in exports, but undercut by slowdowns in both domestic consumption and government spend. Exports were led by solid shipments in the semiconductor and petrochemical sectors.
The YOY figure was no surprise: It fell in line with the median expectations of economists surveyed by Bloomberg, but just short of economists cited by Reuters, who had anticipated 3%. Last week, the BOK shaved its growth projection for 2018 from 3% to 2.9%.
South Korea faces binary economic headwinds.
Globally, the country’s export-reliant economy fears collateral damage from the cross-Pacific trade war between Beijing and Washington. Domestically, government moves to boost the minimum wage – 16.4% this year, and 10.9% next year – have caused grief for owners of small and medium-sized enterprises and have dominated headlines.