South Korea's nominal gross domestic product expanded at its fastest annual pace in nearly 47 years during the second quarter of 2026, boosted by strong global demand for artificial intelligence technologies and related semiconductor exports.
According to preliminary figures released by the Bank of Korea, nominal GDP rose 26.4 percent year-on-year in the April to June period. The reading marks the sharpest annual increase since the third quarter of 1979, when nominal GDP expanded by 27.7 percent. On a quarter-on-quarter basis, nominal output grew 9.2 percent.
Real GDP and Sectoral Performance
Real gross domestic product, adjusted for inflation, grew 0.6 percent from the preceding quarter and 3.7 percent compared to the same period in 2025. The result builds on the 3.8 percent annual expansion recorded in the first quarter, signaling sustained economic momentum.
Exports rose 1.3 percent quarter-on-quarter, led by robust global orders for memory chips, advanced machinery, and technology equipment. Capital commitments into technology also strengthened, with intellectual property investment rising 3.4 percent and facility investment inching up 0.2 percent.
Private consumption recorded a modest 0.4 percent increase over the quarter, offsetting a 0.1 percent contraction in construction investment. Meanwhile, real gross national income expanded 15.6 percent year-on-year, marking its highest growth rate since late 1988.
Revised Economic Outlook
Citing the ongoing global semiconductor supercycle and sustained export demand, the Bank of Korea upgraded its full-year 2026 economic growth forecast to 3.3 percent. Central bank officials noted that investment in AI infrastructure across major overseas markets continues to provide strong support for South Korea's manufacturing and tech sectors.
