SEOUL, Sept. 7 (Xinhua) -- A possibility ran high for South Korea's economy to contract with the COVID-19 resurgence, a state-run think tank said Monday.
The Korea Development Institute (KDI) said in its monthly economic assessment report that with the resurgence of the COVID-19 here, the possibility for the economic contraction went higher.
It noted that downside pressure on the economy expanded with the spread of the COVID-19 since the mid-August.
The number of confirmed COVID-19 cases grew in triple digits since Aug. 14 owing to cluster infections in the Seoul metropolitan area linked to church services and a massive rally in central Seoul on Aug. 15.
The government tightened social-distancing guidelines to address the virus resurgence, encouraging people to stay at home and avoid social gatherings. It weakened consumer spending, hitting hard micro business owners.
The KDI said the economic contraction was expected to be centered around the services industry as the government raised the social-distancing guidelines of the three-tier system to Level 2 with the COVID-19 resurgence.
Credit card spending was estimated to have declined 12.1 percent between Aug. 19 and 30.
Retail sale, which reflects private consumption, added 0.5 percent in July from a month earlier, after expanding 6.3 percent in June.
Production in the services industry plummeted 1.3 percent in July on a monthly basis, after sliding 0.1 percent in June.
The daily average export fell 3.8 percent in August from a year earlier, after skidding 7.1 percent in July. The KDI attributed the improved export to a partial recovery in global demand. Enditem
