South Korea's Nominal GDP Sees Fastest Growth in 47 Years

South Korea's nominal gross domestic product grew at the fastest pace in 47 years during the second quarter, according to data from the Bank of Korea released Tuesday. The nominal GDP expanded 9.2 percent from the previous quarter and 26.4 percent from a year earlier, marking the sharpest growth since the third quarter of 1979. This surge was driven by strong exports and investment related to artificial intelligence, particularly in semiconductors, machinery, and equipment.

Real GDP, a key measure of economic growth, rose 0.6 percent in the April to June period. On a yearly basis, the economy expanded 3.7 percent in the second quarter, following a 3.8 percent expansion in the first quarter. Exports advanced 1.3 percent from the previous quarter, although this was a slowdown from the 5.9 percent increase seen in the first quarter. Private consumption increased 0.4 percent, while government spending climbed 0.1 percent. Facility investment grew 0.2 percent and intellectual property investment gained 3.4 percent, while construction investment fell 0.1 percent.

Gross national income also showed significant growth. Nominal GNI rose 8.8 percent from the previous quarter and 26.4 percent from a year earlier. Real GNI rose 3.1 percent from the previous quarter and 15.6 percent from a year earlier, the steepest growth since the fourth quarter of 1988. The Bank of Korea expects per capita GNI to reach 40,000 US dollars by 2026, provided there are no unexpected external shocks. The central bank has revised its 2026 growth estimate up to 3.3 percent, citing the ongoing semiconductor super cycle.