In Korea, although investment has increased amid generally favorable exports, the Committee appraises economic growth to have remained at a weak level as consumption has declined. On the employment front, amid its continued uptrend led by the higher age groups and the service industry, the number of persons employed has increased by a greater margin in the manufacturing sector as well. Going forward, the Committee anticipates that the negative output gap in the domestic economy will persist for a considerable time, due mostly to the slow recovery of the global economy in consequence chiefly of the sluggishness of economic activities in the euro area.
Consumer price inflation and core inflation excluding the prices of agricultural and petroleum products continued to run at low levels similar to those in the previous month, at 1.5% and 1.2% respectively in January. The Committee forecasts that inflation will remain low for the time being, owing primarily to the weakening of demand-side pressures. As for housing prices, those in Seoul and its surrounding areas continued on their downtrend and those in the rest of the country on their uptrend.
Looking ahead, the Committee will closely monitor external risk factors and geopolitical risks in Korea and the consequent changes in financial and economic conditions, continue its efforts to lower inflation expectations, and conduct monetary policy so as to keep consumer price inflation within the inflation target range over a medium-term horizon while ensuring that the growth potential is not eroded due to the continuation of slow growth.