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Soaring household debt threatens South Korean recovery

Seoul clamps down on speculation in overheated real estate market

Buying of investment properties like housing has driven up South Korean household debt.   © Reuters

SEOUL -- Though South Korea's economy is growing beyond expectations on the back of a thriving chip industry, swelling household debt poses risks to the precarious recovery.

Preliminary data released Thursday by the Bank of Korea showed a 1.4% quarter-on-quarter rise in real gross domestic product for the three months through September, well above market projections in the 0.6% to 0.8% range. Full-year growth is on track to exceed 3% for the first time in three years.

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