Global IBs raise Korea's growth outlooks on chip boom

SEOUL, Oct. 7 (Yonhap) -- Major global investment banks (IBs) have upgraded their forecasts for South Korea's economic growth, citing a strong semiconductor upcycle, a report by the international finance center said Wednesday.

According to the report by the Korea Center for International Finance (KCIF), the median growth forecast by major foreign institutions for 2026 was raised to 3.5 percent in September from 3.3 percent made in August.

They have been upping their growth forecasts for the Korean economy since April this year.

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.

The upward revisions reflect expectations that the global semiconductor cycle will remain stronger and more resilient than previously anticipated.

Among IBs, JP Morgan expects the Korean economy to grow 4 percent this year, up 0.2 percentage point from a month earlier.

Citi jacked up its growth forecast to 3.8 percent from 3.7 percent over the cited period, according to the report.

UBS also raised its forecast to 3.5 percent from 2.8 percent.

For next year, the foreign IBs also raised their growth forecast to 2.8 percent, up 0.3 percentage point from a month earlier, the report showed.