The South Korean central bank estimated 1.1 percent contraction in the pandemic-battered year, revised up from negative 1.3 percent forecast in August on economic improvement in the third quarter.
In its revised estimates for the gross domestic product (GDP) for this year and the next, the Bank of Korea also raised outlook for 2021 to 3.0 percent growth versus earlier 2.8 percent.
Inflation was forecast to rise 0.3 percent this year and 1.5 percent next year.
The positive turn comes amid rising expectations for an arrival of Covid-19 vaccines and cures following a series of news on vaccine progress at home and abroad.
Korea experienced negative growth only twice in its history – negative 1.6 percent in 1980 and negative 5.1 percent in 1998. The last time the central bank expected an annual contraction was 2009 in the aftermath of global financial meltdown, but the country ended the year with 0.2 percent rise.
By Lee Ha-yeon
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