Foreign institutions and investment banks lowered their 2015 forecasts for South Korea’s economic growth, data showed Monday, as domestic demand remains sluggish and tepid global recovery plus a weakening yen signaled hurdles for exports.

The average outlook for the country’s gross domestic product given by 28 foreign institutions came in at 3.5 percent, down 0.3 percentage point from two months earlier. It is also lower than the high 3 percent forecast by the Finance Ministry and the central bank.

The forecasts made by HSBC and U.S.-based IHS Economics were most negative at 3.1 percent, while French financial group BNP Paribas gave 3.3 percent.

Analysts and economists cited a weakening yen as a downside risk factor for Asia’s fourth-largest economy, with Abenomics expected to gain traction in Japan following recent election wins.

Other economists pointed to risks from the Japanese yen’s weakness.

Nomura economist Kwon Young-sun, who put 2015 growth at 3.5 percent, said Japanese firms will likely see their export competitiveness grow if they invest profits from the favorable currency in research and development. (Yonhap)