South Korea’s GDP grew 0.6% in the April‑June quarter, beating economists’ estimate of 0.4%. The growth followed a 1.8% rise in the January‑March period, showing steady momentum.
The stronger growth comes a month after the country’s stock market overtook India to become the world’s sixth‑largest by market capitalisation. This milestone reflects the impact of the AI‑driven semiconductor boom.
On Thursday, the benchmark Kospi rose 2.3% at the open, while the small‑cap Kosdaq gained 1.42%. These gains underline investor confidence in South Korea’s technology sector.
The combined market value of listed companies has surged to about $5 trillion this year, surpassing India’s $4.8 trillion. Samsung Electronics and SK Hynix are the main beneficiaries of the global AI investment cycle.
Bloomberg notes that the latest GDP data could support another interest‑rate hike by the Bank of Korea. The central bank raised rates last week for the first time since 2023.
Governor Shin Hyun‑Song has maintained a hawkish stance, citing above‑target inflation, stronger growth, and rising financial stability risks. His approach aims to keep the economy on a sustainable path.
The semiconductor sector remained the key growth engine during the quarter. Exports rose 1.4%, driven by higher chip shipments, while imports increased 0.8% as companies bought more motor vehicles, machinery, and equipment.
Semiconductor exports jumped about 163% in the first half of the year from a year earlier, already exceeding the record annual level reached in 2025. Computer exports climbed 262% during the same period.
Policymakers believe the AI‑driven semiconductor boom is spilling over into the broader economy. Higher corporate profits, investment, wages and tax revenues help cushion the impact of elevated energy prices and geopolitical tensions.
Overall, South Korea’s robust growth and technology‑led market performance reinforce its position as a global economic leader, while the central bank’s cautious stance seeks to balance expansion with inflation control.