S&P Expects Korea's Economy to Shrink
24 March, 2020
Standard and Poor's has forecast negative growth for Korea this season because of the coronavirus outbreak, an initial for just one of the three major global credit ratings firms.
On Monday, S&P slashed Korea's growth outlook for 2020 from 1.1 percent to -0.6 percent, down another 1.7 percentage points in less than 20 days. The last downward revision was from 1.6 percent to at least one 1.1 percent on March 5.
S&P projects consumer prices to fall 0.4 percent and unemployment to attain 4.2 percent this year. In addition, it estimated Korea's benchmark interest at 0.5 percent by the year's end, down 0.25 percentage points from the current rate.
The firm also predicted minus growth for Hong Kong (-1.7 percent), Singapore (-0.8 percent), and Japan (-1.2 percent) this season, and a mere 2.9 percent growth for China.
Coronavirus will probably cause governments, banks, companies, and households in the Asia-Pacific region a combined financial lack of about US$620 billion, keeping growth in your community at only 2.7 percent, S&P predicted.
Fitch and Moody's, the other two major credit ratings firms, have recently slashed growth projections for Korea to 0.8 percent and 1.4 percent.
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