South Korea's Economic Growth Slows in Second Quarter

South Korea's Economic Growth Slows in Second Quarter

South Korea: South Korea's economy is expected to have expanded by 0.4% in the second quarter of 2026, according to a Reuters poll of economists, slowing from the 1.8% growth recorded in the first quarter. On an annual basis, gross domestic product (GDP) is forecast to grow by 3.5%, compared with 3.8% in the previous quarter. Economists attributed the slower quarterly growth to weak domestic demand and consumer spending, despite continued strength in exports and investment.

Exports remained a key driver of economic activity, with shipments rising by around 71% in June, supported by demand for semiconductors linked to artificial intelligence. Semiconductor exports reached USD 44.8 billion (EUR 38.1 billion), while South Korea recorded a trade surplus of USD 138.3 billion (EUR 117.6 billion) during the first half of the year. The finance ministry has projected full-year economic growth of 3.0%, while economists surveyed by Reuters expect growth to average 2.8% in 2026. The Bank of Korea, which raised its benchmark interest rate earlier this month, is also expected by economists to implement one further rate increase before the end of the year.

Source: Reuters