South Korea's economy grows 1.0% in 3rd quarter on chip boom

Korea's economy experienced a 1% expansion in the third quarter, surpassing initial forecasts, according to the Bank of Korea. The central bank's preliminary data revealed that the country's real gross domestic product (GDP) increased by 1% between July and September, outpacing the BOK's own forecast of 0.3% for the quarter. One of the key drivers behind this strong performance was the surge in semiconductor exports.

Facilities investment rose by 4.1%, primarily due to increased spending on machinery, particularly semiconductor manufacturing equipment. Investment in intellectual property products also grew by 2.3%, as businesses put more money into research and development and software. Exports increased by 2.3%, primarily driven by semiconductor sales and machinery and electrical equipment.

However, imports rose by 2.4%, mainly due to higher imports of crude oil and semiconductor manufacturing equipment. The unexpected growth in Korea's economy provides a solid foundation for the country to meet the BOK's growth target of 3.3% for the year. The economy's rebound from a 0.1% contraction in the previous quarter highlights the significant improvement.