Shoppers take a look at napa cabbages to make kimchi at a retail outlet in Seoul, Thursday. Yonhap

The government adjusted its outlook on Korea's economic recovery, citing growing uncertainties, signaling a potential revision of the country's annual growth target, currently set at around 2 percent.

In its monthly economic report released on Friday, the Ministry of Economy and Finance acknowledged that "uncertainties have increased due to changing conditions both domestically and internationally," while noting that the Korean economy is gradually recovering as prices stabilize.

The government revised its language regarding economic recovery, which it had previously described as "on an upward trend" in the last six reports from May to October.

This expression was omitted in the November report.

The report follows the country's modest gross domestic product (GDP) growth of just 0.1 percent in the third quarter compared to the previous three months, as well as the Nov. 5 U.S. presidential election, in which former President Donald Trump was re-elected.

"We carefully selected our words to accurately reflect the current situation," a ministry official said.

Under the circumstances, Hanyang University economics professor Ha Joon-kyung suggested that the government is "believed to have moderately toned down its assessment of a recovery as it becomes less optimistic about economic growth."

Accordingly, the professor speculated that the ministry may follow other financial institutions, both domestically and internationally, in revising down Korea's growth forecast for 2024.

While the ministry forecasts Korea's economy to grow 2.6 percent, the Bank of Korea (BOK) lowered its projection from 2.5 percent to 2.4 percent. Korea Development Institute and Korea Institute of Finance both slashed their growth outlooks from 2.5 percent to 2.2 percent.

Analysts also said the government may consider lowering the country's growth forecast for 2025, which it estimates at 2.2 percent.

A researcher at the Korea Economic Research Institute (KERI) pointed out that references to the recovery of exports and domestic demand, the twin engines of economic growth, were removed from the November report.

"The report aims to address subtle yet noteworthy changes in economic circumstances, and the fact that such phrases were not mentioned suggests the government is uncertain about the path of recovery," the researcher said, requesting anonymity.

The researcher noted that a second Trump presidency raises concerns over Korea's export-driven economy, particularly due to the new U.S. leader's plans for higher tariffs.

Regarding domestic demand, the surging won-dollar exchange rate, now above the psychological threshold of 1,400, is driving up import prices.

"Such price hikes can lead to higher costs of goods sold here, which could further weaken domestic demand," the researcher said.

The researcher added that the finance ministry could consider lowering Korea's 2025 growth forecast to below 2 percent, based on multiple projections by global investment banks.

For instance, Barclays and JP Morgan both estimate Korea's economy to grow 1.8 percent next year. Nomura and HSBC project Korea's GDP to expand 1.9 percent in 2025.