BofA economists say a more durable semiconductor upcycle driven by sustained
global AI investment could further lift South Korea’s GDP. They raised 2026 and
2027 growth forecasts to 3.6% and 2.5% from 3.1% and 2.2%, respectively, and
expect the semiconductor trade surplus to remain elevated for years. Spillovers
are already visible: stronger manufacturing and construction investment, higher
tax receipts enabling fiscal expansion, and supporting wealth effects
consumption. BofA expects the Bank of Korea to deliver two additional 25bp rate
hikes, possibly in Nov 2026 and Feb 2027.
