Most S. Korean firms want expansionary policies to be maintained: survey

SEOUL, Sept. 14 (Yonhap) -- Most South Korean companies said it is too premature
for the country to end its softer policies put in place to stem the sharp
economic downturn, a survey showed Monday.

A total of 63 percent of the country's top 600 companies said that the Korean
economy is turning to a recovery phase after reaching bottom. However, 91.5
percent said it is too early for the government and the central bank to shift to
tightening stances, according to a survey conducted by the Federation of Korean
Industries.
The survey came as the Korean economy, Asia's fourth-largest, grew 2.6 percent in
the second quarter from three months earlier on the back of massive fiscal
spending and credit easing policies.
The Korean economy is recovering at a faster-than-expected pace, sparking market
speculation that the Bank of Korea (BOK) may hike the rate in the near term. On
Thursday, BOK Gov. Lee Segong-tae hinted that it would conduct a rate increase if
housing prices continue their upward trend.
The central bank cut the rate by a total of 3.25 percentage points to a record
low of 2 percent between October and February, to help boost economic growth.
Last week, the central bank kept its key rate at a record of 2 percent for the
seventh straight month.
According to the survey, 72.6 percent of the firms and 49.4 percent of the
individual respondents said the pace of an economic recovery will likely slow
with many seeing a "U-shaped" or "L-shaped" recovery.
sooyeon@yna.co.kr
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