(Bloomberg) -- South Korean economy is neither facing a crisis nor does it have risks of deflation as some analysts have suggested, said Lee Ho-seung, a top presidential aide for economy, according to Yonhap News Agency.
South Korea is “relatively outperforming despite a global economic downturn” and “it's irresponsible to mention the crisis too easily” as the country is affected mostly by cyclical industries such as semiconductors and construction, Lee was quoted as saying to a group of reporters.
Lee also said that “it's very risky an attitude to say conclusively that the local economy has already entered a deflation phase,” reported Yonhap. After South Korea recorded its first-ever decline in consumer prices in September, some analysts said it may foreshadow a cycle of deflation.
There are chances that consumer prices will fall again in October compared with a year ago, but this is due mainly to the base effect, Yonhap cited Lee as saying.
South Korea's consumer prices fell 0.4% in September from a year earlier, marking the first year-on-year drop on record.
To contact the reporter on this story: Kanga Kong in Seoul at kkong50@bloomberg.net
To contact the editors responsible for this story: Shamim Adam at sadam2@bloomberg.net, Stanley James
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