[Alpha Biz=(Chicago) Reporter Paul Lee] Fitch, an international credit rating agency, has maintained Korea's national credit rating and outlook in a stable manner by AA-, the Ministry of Strategy and Finance said on the 6th.

Fitch forecast that Korea's economic growth rate will grow 2.1 percent this year on the back of a recovery in exports.

In particular, the semiconductor sector is expected to continue its positive trend until next year due to strong demand for artificial intelligence (AI).

The budget deficit is expected to decrease (△1.9%) from last year (△2.0% compared to GDP). It is predicted that the fiscal deficit will decrease next year from this year on the back of the government's fiscal consolidation efforts, and that it will continue to shrink in the future.

The benchmark interest rate is expected to start cutting in the second half of this year and fall to 3.0 percent by the end of the year. Consumer price growth is on the decline, and Korea's current account surplus is expected to expand from 2.1% to 2.8% this year compared to GDP in 2023. The foreign exchange reserves are estimated to be sufficient for 6.2 months of the total current payment.

In the financial sector, Korea's financial stability risks are well managed, and domestic banks' project financing (PF) loan exposure is low.

 

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