Global credit appraiser Fitch Ratings on Wednesday lowered its 2022 growth outlook for the South Korean economy to 2.4 percent, citing the fallout of the protracted war between Russia and Ukraine and China's economic slowdown.

The latest outlook is a 0.3 percentage-point drop from its March estimate of 2.7 percent growth for Asia's fourth-largest economy.

Fitch said slower global growth and China's economic slowdown are posing "external challenges" to the South Korean economy.

The rating agency also cited the Ukraine crisis, major central banks' monetary tightening and further potential COVID-19 lockdowns in China as additional economic "hurdles" for South Korea.

Fitch's growth outlook is lower than the Bank of Korea (BOK)'s 2.7 percent forecast and the International Monetary Fund's 2.5 percent projection.

Fitch said South Korea's inflation is expected to keep rising "rapidly" as high energy and raw material prices have pushed up manufacturing costs.

The country's consumer prices jumped 5.4 percent in May on-year, the fastest rise in almost 14 years and a pickup from a 4.8 percent gain in April.

The agency forecast the Bank of Korea (BOK) to additionally raise the policy rate by 0.5 percentage point by the end of this year, and stand pat at 2.25 percent throughout 2023.

In May, the BOK raised the key interest rate by a quarter percentage point to 1.75 percent to tame inflation. It marked the fifth rate hike since August last year.

South Korea's inflationary pressure has built up as energy and food prices have surged amid the war in Ukraine and global supply disruptions. Demand-pull price pressure also rose due to the recovery in demand.

The BOK's 2022 inflation growth projection stands at 4.5 percent. The Organization for Economic Cooperation and Development (OECD) sharply raised its inflation outlook for South Korea to a 24-year high of 4.8 percent. (Yonhap)