Foreign investors' outlook on South Korea's economic growth remains solid, despite North Korea's recent artillery attack on a South Korean island, a report showed Thursday.
The country's economic growth rate, predicted late last month by 10 overseas investment banks, came to an average of 6 percent for this year and
4 percent for 2011, the Korea Center for International Finance (KCIF) said in a report. The figures stayed unchanged from their forecasts made the previous month.
Last week, North Korea shelled Yeonpyeong Island near the disputed Yellow
Sea border, killing four South Koreans and wounding 18 others. One of the worst provocations since the 1950-53 Korean War, it rekindled worries over geopolitical risks on the Korean Peninsula.
Out of the five investment banks that revised their forecasts after the attack, only France's BNP Paribas SA lowered its estimate for this year,
changing it to 6.3 percent from an earlier 6.6 percent, the report said.
The French company, however, raised its 2011 growth forecast for Asia's fourth-largest economy to 4.7 percent from 4.2 percent, it added.
Foreign investors, meanwhile, expressed concerns over the country's consumer inflation, which has gained pace in the second half of the year, the report said.
Four of the 10 banks said consumer prices are likely to gain more than 3 percent this year, up from the 2.8 percent average in October, the report said. The forecast for next year also grew to 3.1 percent from 3 percent.
In a bid to curb mounting inflationary pressure, the country's central bank hiked the key interest rate by a quarter percentage point to 2.5
percent in November, following a three-month freeze.
The Bank of Korea said earlier that the Korean economy is on a solid recovery track and the country's consumer inflation is expected to grow at about a 3 percent pace down the road.