Korea's economy grows 1% in Q3 on chip exports, beating forecasts

The Korean economy expanded by 1 percent in the third quarter, marking a stronger-than-expected recovery, according to the Bank of Korea (BOK). The preliminary data from the central bank revealed that real gross domestic product (GDP) grew by 1 percent in the July-September period, surpassing the BOK's own projection of 0.3 percent for the quarter.

The investment in facilities increased by 4.1 percent, primarily due to heightened investment in machinery, including semiconductor manufacturing equipment. Additionally, investment in intellectual property products rose by 2.3 percent, as spending on research and development and software also increased. Exports grew by 2.3 percent, primarily driven by semiconductors and machinery and electrical equipment.

On the other hand, imports rose by 2.4 percent, fueled by higher crude oil and semiconductor manufacturing equipment. This stronger-than-expected growth positions the economy on a more robust footing to meet the BOK's growth forecast of 3.3 percent for the year. The quarterly growth rebounded significantly from a 0.1 percent contraction in the previous quarter.