Seoul: The Bank of Korea (BOK) announced that its outlook for South Korea's economic growth for 2025 may be lowered to between 1.6 and 1.7 percent. This adjustment comes amid a political crisis triggered by the suspension of President Yoon Suk Yeol and weak domestic demand.

According to Yonhap News Agency, the BOK had initially projected a 1.9 percent growth rate for 2025 back in November. However, the central bank now believes that its forecast requires revision due to political uncertainties that emerged following the imposition of martial law in December. This situation has adversely affected economic sentiment, leading to a prospective reduction in the growth outlook by approximately 0.2 percentage points.

The BOK plans to officially release its revised growth forecast in February. The final figure will largely depend on how quickly political uncertainties are resolved, the implementation of government support measures, and the economic policies of the new U.S. administration.

The finance ministry had previously predicted a 1.8 percent growth for the same year, citing increased uncertainties both domestically and internationally. South Korea's potential growth rate stands at 2 percent, and the forecasted figures suggest that this year might be the first time the country's annual growth rate falls below this level.

In December, the National Assembly voted to impeach President Yoon following a brief yet shocking imposition of martial law. Yoon was formally arrested on Saturday as investigations into the incident continue.