South Korea's growth improves on better consumption

SEOUL, South Korea – South Korea’s economic growth has improved during the second quarter thanks to stronger private consumption and increased housing construction.

Bank of Korea said Tuesday that Asia’s fourth-largest economy expanded 3.2 per cent during the April-June period, the fastest clip in seven quarters.

From the previous three months, it eked out a 0.7 per cent growth. On a quarterly basis, South Korea’s economy grew less than 1 per cent for a third straight quarter.

The bank said sales of clothes and durable goods drove up private consumption. Construction spending was robust thanks to an increase in new houses.

Bank of Korea trimmed its benchmark interest rate last month to a record low of 1.25 per cent, the first rate cut in one year. It downgraded its growth forecast on South Korea, citing increased global uncertainties.