S. Korea to keep stimulus policy amid lingering downside risks

(ATTN: ADDS details from 4th para)
SEOUL, Oct. 8 (Yonhap) -- South Korea's economy is staging a steady rebound but
the government said Thursday that it will maintain its "expansionary" economic
policy stance amid a sluggish private-sector recovery and uncertainties in
overseas markets.
"The economy keeps improving on a steady basis but the private sector is seeing
an insufficient rebound and other downside risks coexist such as a possible delay
in the global recovery," the Ministry of Strategy and Finance said in a report.
"Against such a backdrop, we will maintain our expansionary macroeconomic policy
stance," it noted, adding that it will try to utilize all the budget resources
left for this year during the second half as a means of offsetting its declining
fiscal capacity.
The government assessment comes amid growing optimism that the economy is
rebounding at a faster-than-expected pace from a steep downturn with major
indicators painting a bright picture of Asia's fourth-largest economy.
The report expected that South Korea's industrial output will improve in
September amid rebounding exports. Output posted on-year growth for the two
previous months.
Consumption and corporate investment are also showing signs of a pickup.
Sales of consumer goods grew 2 percent in August from a year earlier, marking the
fourth straight month of on-year advances. Facility investments during the second
quarter surged 10.1 percent from the previous three months and the report
forecast September investment will continue to increase.
Export contraction also seems to be slowing amid signs of a global economic
rebound. Overseas shipments shrank 6.6 percent in September from a year earlier,
sharply decelerating from a 0.9 percent decline in August, the report showed.
kokobj@yna.co.kr
(END)