The Organization for Economic Cooperation and Development(OECD) has raised its projections for South Korea's growth and inflation in 2022.  

According to the biennial report on the domestic economy, the OECD increased its growth forecast by zero-point-one percentage point to two-point-eight percent, an unusual move compared to the recent downgrades posted by South Korea’s central bank and the International Monetary Fund amid persistent inflation. 

The OECD credited strong exports and the nation’s sound handling of the COVID-19 pandemic for the upgrade, but simultaneously lowered the 2023 growth forecast to two-point-two percent from its previous two-point-five percent estimate.

It also raised its 2022 inflation outlook to five-point-two percent amid high energy prices influenced by the protracted war in Ukraine, but did predict a rate of three-point-nine percent next year on the basis that global oil prices remain similar to this year.

The IMF pointed to the fast-increasing household debt and real estate prices as risk factors, and recommended the country continue to move toward a less accommodative monetary policy stance with a view to keep inflation expectations in check.