The state-run Korea Development Institute(KDI) revised down its economic outlook for next year from two-point-three to two-point-two percent.

In an outlook report for the second half of 2023, the KDI said that despite a slowdown in the growth of domestic demand, the local economy is expected to grow two-point-two percent in 2024 due largely to a modest recovery centered around exports.

The revised outlook is lower than the government's forecast of two-point-four percent, but higher than the two-point-one percent put forth by the Organization for Economic Cooperation and Development.

The state institute also revised down its outlook for this year from the one-point-five percent forecast in May to one-point-four percent.

The KDI's latest inflation projection this year stood at three-point-six percent, up zero-point-two percentage points from May, while next year’s forecast came in at two-point-six percent for a zero-point-one-percentage-point increase from August.

The think tank listed geopolitical conflict in the Middle East and housing prices in China as two major external risks for the domestic economy.