The state-funded Korea Development Institute(KDI) assessed that the domestic economy faces expanded downside risks amid growing external uncertainty stemming from the Ukraine crisis.

The KDI gave a more sober outlook compared to the previous month in its latest monthly report released on Thursday, although it did determine that the economy is on a moderate recovery track centered around the manufacturing sector.

Industrial output in February jumped four-point-three percent on-year, increasing at the same pace for the second straight month. Manufacturing production, excluding the auto industry, rose six-point-five percent on-year.

Corporate sentiment, however, worsened since Russia's invasion of Ukraine, reflecting concerns over rising raw material prices. The business sentiment index for the manufacturing sector dropped ten points from 93 in March to 83 in April.

Outbound shipments rose 18-point-two percent on-year in March due to high raw material prices, but overall trade saw a deficit of 140 million dollars.