Major investment banks(IB) forecast that an expansion of the South Korean economy above one percent this year will be challenging.

According to the Korea Center for International Finance, the average projection of growth by eight foreign IBs – Barclays, BofA Securities, Citi, Goldman Sachs, JP Morgan, HSBC, Nomura and UBS – came to one-point-one percent for 2023 as of late March.

While six IBs gave an outlook in the one-percent range, Citi predicted a zero-point-seven-percent expansion, and Nomura, contraction of negative-zero-point-four percent.

For 2024, the average growth forecast of the eight IBs was revised down from two-point-one percent in late February to two percent in late March.

The banks projected inflation in the country to fall from five-point-one percent last year to three-point-two percent this year, then to one-point-nine percent next year, below the Bank of Korea's target of two percent.

They expected the country's GDP-to-current account surplus ratio to rise zero-point-one percentage point to one-point-eight percent this year, before surging to two-point-seven percent next year.