South Korea's economy grew slightly faster than expected in the first quarter, thanks to a robust recovery of exports and facility investment, inching the nation's economic growth closer to the pre-pandemic level, central bank data showed Wednesday.

Asia's fourth-largest economy grew 1.7 percent in the first quarter from three months earlier, 0.1 percentage point higher than earlier expected, according to preliminary data from the Bank of Korea (BOK).

The country's annualized growth in the January-March period was also revised up to 1.9 percent, up 0.1 percentage point.

"Facilities investment grew by 6.1 percent, led by the growth of investment in machinery and transportation equipment," the BOK said in a statement.

"Exports increased by 2 percent, as exports of goods, such as motor vehicles and mobile phones, expanded," it said.

Last month, the BOK sharply raised its 2021 growth outlook to 4 percent from 3 percent, while holding its benchmark policy rate unchanged at a record low of 0.5 percent, amid a strong rebound in exports.

BOK Gov. Lee Ju-yeol has said the pace of the economic recovery was faster than expected but more patience is necessary for the monetary policy.

However, Lee sounded a slightly hawkish tone when asked about the possibility of a rate hike this year, saying that such a hike "depends on the pace of recovery."

Park Yang-su, head of the BOK's economic statistics bureau, told reporters that if the economy grows 0.7 percent or 0.8 percent on a quarterly basis by the fourth quarter of this year, the annual GDP would grow 4.1 percent or 4.2 percent this year.

In the first quarter, private consumption grew 1.2 percent on-quarter and construction investment rose 1.3 percent from the previous quarter, the BOK said.

South Korea's economy shrank 0.9 percent in 2020, 0.1 percentage point higher than earlier estimated.

However, it marked the first annual contraction since 1998, when the economy shrank 5.1 percent due to the Asian financial crisis.

In 2019, the economy expanded 2.2 percent, accelerating from its earlier estimate of 2 percent.

Meanwhile, the BOK said the country's gross national income (GNI) increased 2.4 percent in the first quarter from three months earlier.

"Real GNI grew by 2.4 percent compared to the previous quarter, increasing more than the real GDP (1.7 percent), owing to increased net factor income from the rest of the world and improved terms of trade," the BOK said.

In terms of US dollar value, the country's per capita income came to $31,881 in 2020, down 1 percent from a year earlier. (Yonhap)