Thanks to the all-time boom in semiconductor exports, the average of Korea's economic growth forecas..
Thanks to the all-time boom in semiconductor exports, the average of Korea's economic growth forecast for this year by major overseas investment banks (IBs) entered the 3% range for the first time. Expectations for the Korean economy are rising rapidly, with some institutions even suggesting a growth rate of around 4%. According to the International Financial Center on the 7th, Korea's real gross domestic product (GDP) growth forecast for eight major overseas IBs was 3.0 percent on average as of the end of June. It is up 0.2 percentage points from the end of May (2.8 percent). This is the first time that the average growth rate of major IBs in Korea this year has exceeded 3%. IBs' forecasts rose from 2.0% at the end of last year to 2.1% at the end of January this year, before rising to 2.4% at the end of April, 2.8% at the end of May, and 3.0% at the end of June. It has been upgraded for the past three consecutive months, up 1.0 percentage points in half a year. By institution, JPMorgan made the largest upward adjustment, increasing 0.7 percentage points from 3.0% to 3.7%. Citibank also raised its forecast from 3.0% to 3.5%. Barclays raised 2.7% to 2.7% from 2.6%, Goldman Sachs raised 2.5% to 2.7% and HSBC raised 2.6% to 2.8%. On the other hand, Bank of America (3.1%), Nomura (2.4%) and UBS (2.8%) maintained their previous outlook. As exports continue to be strong, with monthly exports exceeding $100 billion for the first time in history last month, domestic and foreign institutions' growth prospects are also rising one after another. Some institutions also expected growth in the 4% range. British Capital Economics recently presented a 4.0% growth forecast for Korea this year, while Korean Ri forecast 4.1%. The Bank of Korea is also likely to raise its growth forecast for this year in its revised economic outlook in August. As the preliminary growth rate for the first quarter of this year was 1.8%, which is 0.1 percentage points higher than the breaking news, there is more room to adjust the annual growth forecast of 2.6%, which was presented in May. Bank of Korea Governor Shin Hyun-song also said at an academic conference of the Korean Financial Association on the 19th of last month, "This year's annual growth forecast will be raised from 2.6% mechanically." The outlook for the current account also improved significantly due to the booming exports of semiconductors. As of the end of June, the current account surplus ratio to nominal GDP for this year by eight major overseas IBs was estimated at an average of 14.0%. It is 3.2 percentage points higher than a month ago (10.8 percent), and more than double the forecast at the end of last year (6.5 percent). Except for UBS (4.0%), all seven institutions raised their current account outlook. HSBC raised its forecast by 7.2 percentage points from 9.8% to 17.0%, while Citibank (11.8% → 16.4%), Bank of America (15.0% → 16.1%), Nomura (10.0% → 15.5%), Goldman Sachs (12.4% → 15.1%), JPMorgan (10.2% → 14.8%), and Barclays (12.8% → 13.0%) also raised their forecasts.
Source: 매일경제