S. Korea's economy recovering at moderate pace

South Korea's economic recovery seems to be moderating as lingering external risks including the eurozone debt crisis are weighing on the nation's export-driven economy, a state-run think tank said Monday. "The Korean economy, mainly driven by exports, showed gradual economic moderation," the Korea Development Institute (KDI) said in its monthly economy assessment report. The think tank, in particular, cited the latest industrial and service-sector output, saying that they are indicating a "moderate" slowdown in production. Inflation is showing signs of easing amid the slowing recovery, the KDI noted, citing the recent consumer price index data. South Korea's consumer prices rose 3.9 percent last month from a year earlier, marking the first time this year that the price hike has fallen below the government's annual inflation target of 4 percent for 2011. Touching on external risks, the KDI painted a somewhat optimistic picture over the state of the ongoing debt and financial market, saying that uncertainties over the fiscal crisis in Europe appear to be resolved to some extent. "In the eurozone, financial instability appears to be somewhat resolved with measures being prepared to address the fiscal crisis," the think tank said. "The global financial markets face slightly reduced uncertainties as bailout measures have been suggested."