The Bank of Korea on Thursday raised its full-year 2026 growth forecast for the South Korean economy to 2.6 per cent from the 2.0 per cent projection it had carried since February, the largest upside revision in five years. The central bank's economic outlook report attributed the bulk of the upgrade to the continuing semiconductor export boom that has powered Samsung Electronics and SK Hynix into the trillion-dollar club this spring.
BOK governor Rhee Chang-yong told reporters in Seoul that "the headline export number for the first quarter alone justified more than three-quarters of the revision" and added that if semiconductor export volume growth were to exceed twenty per cent on the year, full-year GDP could reach above three per cent. The May data, due next week, are expected to show exports up roughly twenty-eight per cent year-on-year on the headline number.
The upgrade comes against an exceptionally strong year for Korea's memory champions. Samsung Electronics has gained roughly one hundred and forty-four per cent year-to-date and SK Hynix nearly two hundred per cent, taking the broader Kospi index up eighty-six per cent over the same period and making it the world's best-performing major equity market for 2026. SK Hynix on Wednesday joined Samsung and Micron above the trillion-dollar threshold.
The BOK held its base rate at 2.5 per cent at Thursday's policy meeting, a decision that had been broadly expected. Governor Rhee said the bank would "carefully monitor" the implications of the equity-led wealth effect, won strength, and the still-fragile real estate market before making any further moves. Money markets now price the next move as a rate hike, fully discounted by early 2027.
Deputy prime minister and finance minister Bae Kyung-hoon, speaking separately in Seoul on Thursday evening, said that ensuring the gains of the AI and semiconductor boom were "shared with the wider public" remained a top government priority. The Lee administration has separately pushed for tighter labour-management regimes at Samsung Electronics and has begun consultations on a corporate AI levy that would fund retraining programmes.
Inflation is the BOK's emerging concern. Headline CPI has held at 2.1 per cent year-on-year through April, but the bank's outlook now projects 2.6 per cent for the second half of 2026 as a stronger labour market and won strength reverse. Rhee said the bank's mandate "remained price stability first" and that he would "not allow the wealth effect of the chip rally to seep into goods inflation unchecked."