A state-run think tank has assessed that the South Korean economy is becoming sluggish due to weakening demands at home and abroad.

The Korea Development Institute (KDI) on Sunday presented the assessment in its monthly report on economic trends. 

The institute had assessed since last November that the economy is slowing down, but it used the word "sluggish" for the first time in its assessments.

The KDI expressed concerns over falling economic indicators of consumption, exports, investment and production. 

South Korea's retail sales posted negative growth of two percent in February from a year earlier, significantly below last year's annual average of four-point-three percent and the fourth quarter average of three percent.

Facility investment plunged 26-point-nine percent in February from a year earlier due to weakening demand in both machinery and transport equipment.