SEOUL, South Korea (AP) — The Bank of Korea says South Korea's economy grew at a 2.7 percent annual pace during the April-June quarter.

The central bank said Thursday that Asia's fourth-largest economy saw lower exports but a big jump in capital spending and improved consumer spending supported growth. The economy grew 2.9 percent in the previous quarter.

On a quarterly basis, the economy grew 0.6 percent from the January-March period.

Earlier this week, the government upgraded its forecasts for growth in this year to 3 percent, citing strong exports led by semiconductor companies that sharply increased capital spending.

President Moon Jae-in's administration plans $10 billion in stimulus to create jobs and improve the country's social safety nets, to help revive lagging consumer demand.