The projected growth of 3.2 percent for next year is lower by 0.1 percentage point than the government's estimate.
The Bank of Korea (BOK) also cut its 2015 growth forecast for the nation's economy to 2.7 percent from the previous projection of 2.8 percent. The figure is lower by 0.4 percentage point lower than the government's forecast of 3.1 percent.
In its "Economic Outlook for 2015 and 2016" report, the BOK said the projected growth path is exposed to both upside and downside risks.
The upside risks include faster economic growth in the United States and the euro area, and an additional decline in international oil price, the report said.
Among the downside risks are economic slowdowns in China and resource-exporting emerging market economies (EMEs), and the worsening of economic sentiment associated with heightened global financial market volatility, it said.
The central bank slashed its inflation forecast for 2015 and 2016 to 0.7 percent from 0.9 percent and to 1.7 percent from 1.8 percent, respectively.
"Consumer price inflation is expected to be low, at an annual average below 1 percent, owing primarily to the effects of low oil price and to continued downward pressures from the demand side," the report said.
"The downward pressure on consumer prices from the fall in petroleum product price is expected to disappear after the first quarter of 2016," it said.
reporter
Park Sae-jin
swatchsjp@ajunews.com
