A restaurant preparing for business on Myeongdong Street in Seoul on April 20. Yonhap News

The International Monetary Fund (IMF) has lowered its growth forecast for South Korea this year from 1.0% to 0.8%.

The Ministry of Economy and Finance announced that the IMF, in its July World Economic Outlook released on the 29th, revised its forecast for South Korea's real Gross Domestic Product (GDP) growth this year to 0.8%.

The IMF publishes economic outlooks for all member countries in April and October each year, and revised forecasts for the major 30 countries in January and July.

The IMF had forecast Korea's growth rate at 1% in April and lowered it by 0.2 percentage points (p) after three months.

This is interpreted as meaning that the effects of the first supplementary budget of 13.8 trillion won, implemented since May, have not yet shown clear results.

During the same period, the forecast for global economic growth rose by 0.2%p, from 2.8% to 3.0%.

The economic growth forecast for the advanced economies group, which includes countries like Korea, the United States, the United Kingdom, Germany, and Japan, was revised upward by 0.1%p, from 1.4% to 1.5%.

The IMF's latest growth forecast for Korea aligns with changes and trends in estimates from major domestic and international institutions.

Recently, the Bank of Korea and the Korea Development Institute (KDI) lowered their economic growth forecasts for this year to 0.8%. Last month, the Organisation for Economic Co-operation and Development (OECD) also lowered its forecast to 1%.

The IMF raised its growth forecast for Korea next year by 0.4 percentage points (p), from 1.4% to 1.8%.

This figure is also higher than the 1.6% forecast by major domestic and international institutions such as the Bank of Korea, KDI, and the Asian Development Bank (ADB).

The forecast for global economic growth was revised upward by 0.1%p, from 3.0% to 3.1%, and the growth forecast for the advanced economies group also increased by 0.1%p, from 1.5% to 1.6%.

The IMF did not include specific details regarding the adjustment of Korea's growth rate in the main body of this report.

However, Rahul Anand, the IMF's mission chief for Korea, separately explained that "the downward revision of Korea's growth forecast this year is due to the poorer-than-expected performance in the first half, stemming from domestic political and global trade uncertainties," according to the Ministry of Economy and Finance.

Anand attributed the upward revision of next year's forecast to "the prediction that a gradual economic recovery will begin in the second half of this year and continue into next year," adding that "this is driven by the supportive policy stance, including two supplementary budgets, and improved consumer and investment sentiment since mid-second quarter due to the resolution of domestic political uncertainties."

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