South Korea's economic growth slowed in the fourth quarter from three months earlier but logged the fastest expansion in two years in 2013 on exports, the central bank said Thursday.

Korea's gross domestic product (GDP), the broadest measure of economic performance, grew 0.9 percent in the October-December period from three months earlier, compared with a 1.1 percent on-quarter gain in the third quarter, according to the Bank of Korea (BOK).

The fourth-quarter growth was the slowest since a 0.8 percent on-quarter gain in the first quarter.

From a year earlier, the local economy grew 3.9 percent in the fourth quarter after gaining 3.3 percent on-year in the third quarter.

For the whole of 2013, Asia's fourth-largest economy grew 2.8 percent, the fastest in two years, after increasing 2 percent in the previous year.

The BOK said exports maintained solid growth last year, private spending continued to rise and construction investment post a big rebound.

"In the fourth quarter, the private sector led the growth. But the quarterly growth slowed as the government spending declined on a fall in tax revenue," Jung Young-taek, director general of the BOK's economic statistics division, told reporters.

Jung said that facility investment is on the recovery, but it remains to be seen whether capital investment will maintain its growth.

The data came as the BOK maintained its 2014 projection for the economic growth at 3.8 percent while it lowered the inflation outlook to 2.3 percent from its earlier estimate of 2.5 percent.

The central bank froze the key interest rate at 2.5 percent for the eighth straight month in January as the local economy is on the recovery track amid tame inflation.

Exports, which account for around 50 percent of the GDP, gained 2 percent on-quarter in the fourth quarter after falling 1.3 percent on-quarter in the previous quarter.

Private spending rose 0.9 percent on-quarter last quarter after gaining 1 percent in the third quarter.

Facility investment rose 6.4 percent last quarter, compared with a 1 percent on-quarter gain in the previous quarter.

Construction investment contracted 3.8 percent, compared with a 3.2 percent on-quarter expansion three months earlier, the BOK said. (Yonhap News)