The Korea Development Institute raised its 2026 GDP growth forecast to 2.5% from 1.9% in February, citing strong semiconductor sector performance. Investment in semiconductor manufacturing equipment surged 75.9% in May, outpacing overall facility investment growth of 9.7%. South Korean exports expanded by 70.9% in June, driven primarily by semiconductors and ICT products. The government was even more bullish, projecting 3.0% GDP growth, 0.5 percentage points above the KDI estimate. This revision reflects an emerging semiconductor supercycle fueled by global AI chip demand.
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