IMF lowers economic outlook for South Korea to 0.8%

South Korea's economic outlook has been lowered by the IMF yet again.

After it was slashed in half in April it has been lowered further to 0-point-8 percent amid volatility in global trade.

Our Kim Do-yeon reports.

The International Monetary Fund has once again cut its growth forecast for South Korea this time to 0.8% for 2025.

In its latest World Economic Outlook update released Tuesday, the IMF lowered Korea's growth projection by 0.2 percentage points from April, which was already half of January's 2.0% forecast.

Lower projections have also been released recently by other institutions.

The Korea Development Institute and BOK both fixed their 2025 growth outlook to 0.8% as well with the OECD having the most positive outlook at 1.0%.

While no direct commentary for South Korea was provided South Korea is heavily reliant on trade with the U.S., and tariffs had an impact on these numbers according to the IMF.

"A breakdown in trade talks or renewed protectionism could dampen growth globally and fuel inflation in some countries."

As for South Korea's 2026 outlook the IMF's projection improved for South Korea to 1.8% from 1.4% in April.

The IMF releases economic outlooks for all member countries every April and October, and publishes revised forecasts for the 30 major economies in January and July.

For the world's economic outlook the IMF revised its projection to 3.0% from 2.8%.

Still lower than its forecast earlier this year but showing improvement.

"Global growth has been revised up to 3.0 percent in 2025 and 3.1 percent in 2026, reflecting stronger-than-expected front loading, lower tariff rates compared to early April, easier financial conditions, including a weaker U.S. dollar and fiscal expansion in some jurisdictions."

As for other nations the U.S. growth forecast was raised by 0.1 percentage point to 1.9%, while China's was significantly revised up by 0.8 percentage points to 4.8%.

Kim Do-yeon, Arirang News.