Korea showing signs of improvement on robust chip industry: KDI

The Korean economy demonstrated a broader improvement in July, propelled by the robust performance of semiconductor-related industries, according to the Korea Development Institute (KDI). Exports and equipment investment continued to surge, with semiconductors playing a key role in driving this growth, while consumption growth also accelerated, particularly in the durable goods sector.

All-industry production witnessed a relatively high growth rate, as services maintained a favorable trend and manufacturing rebounded. However, the KDI warned that despite this progress, the country's economy still faces uncertainties, including U.S. tariff policies and ongoing geopolitical instability in the Middle East. The KDI also highlighted that elevated inflation and weakening employment conditions pose significant economic challenges for Korea, which remains the world's fourth-largest economy.