South Korea Q3 GDP Growth Stronger Than Expected

South Korea’s economy grew by 1% quarter-on-quarter in the third quarter of 2026, surpassing expectations of 0.7% and accelerating from a 0.6% expansion in the previous quarter, preliminary estimates showed. Exports and investment were the key drivers of overall growth, as the global investment in AI sustained demand for semiconductors. Exports rose 2.3%, led by semiconductors, machinery and electrical equipment, while imports grew 2.4%. Facility investment jumped 4.1%, mainly reflecting increased spending on machinery, including semiconductor manufacturing equipment. Construction investment also returned to growth, rising 0.7% as civil engineering activity improved, while government consumption increased 1.9%. By contrast, private consumption fell 0.2%, the first decline in nearly four years as spending on both goods and services decreased. On a yearly basis, the economy expanded by 3.4%, slowing from a 3.7% growth in the second quarter but exceeded forecasts for a 3% increase.

South Korea’s economy advanced 0.6% QoQ in the second quarter of 2026, confirming preliminary estimates but easing from 1.8% growth in the first quarter, which was the strongest quarterly expansion since Q1 2021. GDP growth was mainly driven by robust exports, which offset downward pressure from the lingering conflict in the Middle East. Exports rose 1.3%, boosted by IT products such as semiconductors and machinery and equipment, while imports increased at a softer rate of 0.7%. Private consumption climbed 0.4%, supported by higher spending on both goods and services, while government consumption edged up 0.1%. Investment in intellectual property products grew by 3.4%, while facility investment advanced 0.2%. By contrast, construction investment inched down 0.1% as civil engineering activity declined. On a yearly basis, the economy advanced 3.7% in Q2, easing from a 3.8% expansion in Q1, which marked the fastest annual growth since Q4 2021.

South Korea’s economy expanded by 0.6% QoQ in the second quarter of 2026, surpassing expectations of 0.4% but slowing from 1.8% growth in the first quarter, which was the strongest quarterly expansion since Q1 2021, preliminary estimates showed. GDP growth was mainly driven by robust exports, which offset downward pressure from the lingering conflict in the Middle East. Exports grew 1.4%, driven by IT products such as semiconductors and machinery equipment, while imports rose at a softer rate of 0.8%. Private consumption climbed 0.4%, supported by higher spending on both goods and services, while government consumption rose 0.2%. Investment in intellectual property products grew by 3.3%, while facility investment advanced 0.2%. By contrast, construction investment fell 0.2% as civil engineering activity declined. On a yearly basis, the economy grew 3.7% in Q2, easing from 3.8% in Q1, which marked the fastest annual growth since Q4 2021, while remaining above market estimates of 3.5%.