Global Investment Banks Raise South Korea's 2026 Growth Forecast to 3% Amid AI Boom

SEOUL, July 7 (Yonhap) -- Major global investment banks' average forecast for South Korea's economic growth this year has reached 3 percent for the first time, data showed Tuesday, supported by robust semiconductor exports amid the artificial intelligence (AI) boom.

Growth forecasts for South Korea's real gross domestic product (GDP) in 2026 by eight major investment banks, including JP Morgan and Citi, averaged 3 percent at the end of June, up 0.2 percentage point from a month earlier, according to data compiled by the Korea Center for International Finance.

It marked the first time that the average forecast had reached the 3 percent level.

The average forecast stood at 2 percent at the end of last year. It rose to 2.1 percent in January, 2.4 percent in April and 2.8 percent in May.

JP Morgan predicted 3.7 percent growth for the South Korean economy in June, up 0.7 percentage point from 3 percent a month earlier.

Citi also raised its forecast to 3.5 percent from 3 percent over the same period.

Barclays and Goldman Sachs each projected 2.7 percent growth, while HSBC and UBS forecast 2.8 percent each.

Bank of America projected 3.1 percent growth, while Nomura forecast 2.4 percent.

The improved outlook reflects strong semiconductor exports fueled by surging global demand for AI-related chips.

South Korea's exports reached a record US$102.25 billion in June, up 70.9 percent from a year earlier and surpassing the $100 billion mark for the first time.

Exports of semiconductors nearly tripled to reach a record $44.82 billion.

The latest data from the Bank of Korea (BOK) showed that the country's GDP expanded 1.8 percent in the first quarter, up 0.1 percentage point from the central bank's preliminary estimate.

Against this backdrop, the BOK is widely expected to raise its 2026 growth forecast in August from its current projection of 2.6 percent.