South Korea's economy grew at its fastest pace in more than seven years in the third quarter, fueled by a fast economic recovery, The Associated Press reported Monday, quoting the central Bank of Korea.

Gross domestic product grew 2.9 percent in the three months ended Sept. 30 compared with the previous quarter when it expanded 2.6 percent. The figure is preliminary and subject to revision.

That marked the strongest growth since an expansion of 3.8 percent in the first quarter of 2002, according to bank data.

South Korea has been recovering from its worst downturn since the 1997-98 Asian financial crisis as a weaker currency and government stimulus programs overseas boost exports. Record-low interest rates and government spending at home have also helped stimulate the fourth-largest Asian economy.

The unemployment rate fell in September to a nine-month low of 3.4 percent, consumer and business sentiment have risen and the current account ― South Korea's broadest measure of trade ― is firmly back in surplus after a deficit last year for the first time since 1997.

Hyundai Motor and Kia Motors, both major exporters, reported record quarterly net profits in the third quarter as sales rose.

The country's latest GDP figure marks the third straight three-month period that the economy has grown. It eked out a 0.1 percent expansion in the first quarter after having contracted 5.1 percent in the final three months of 2008.

The central bank also said Monday that South Korea's economy grew in the third quarter compared with the same period last year, expanding 0.6 percent. That snapped three straight quarters of year-on-year contraction.

Manufacturing expanded 8.7 percent in the third quarter, while capital spending grew 8.9 percent.
The latest growth figures also add to evidence that Asian countries are leading a recovery in the world economy after it slumped severely in the aftermath of the global financial meltdown last year, according to AP.

China's economy, the world's third largest, grew 8.9 percent in the third quarter from a year earlier, accelerating from an expansion of 7.9 percent in the second. Singapore's economy grew an annualized 14.9 percent in the third quarter, expanding for a second straight three-month period.