The Korea Development Institute (KDI) delivered a positive economic assessment for the fourth consecutive month, stating that "moderate production growth continues, led by the service sector." However, the institute noted that external uncertainties, including U.S. tariffs, are expanding again.
In its February issue of "KDI Economic Trends" released on the 9th, KDI stated that "the Korean economy recently maintains moderate production growth centered on the service sector, driven by consumption improvement." This marks the fourth consecutive month since November last year that consumption has been assessed as leading economic improvement.
Regarding exports, KDI noted that while volume growth has somewhat moderated, export values continue to show strong growth due to rising semiconductor prices. The institute explained that manufacturing production declined slightly as automobile output weakened amid U.S. tariff impositions, while semiconductor supply remained constrained despite surging demand. The assessment wording was revised from "manufacturing somewhat adjusting" last month to "manufacturing production declining slightly," indicating a one-notch deterioration in the economic outlook for manufacturing.
On external variables, KDI diagnosed that uncertainty has somewhat expanded for the first time in two months. "External uncertainties are resurfacing due to the possibility of U.S. tariff increases and heightened oil price volatility," the institute assessed.
The construction sector slump continues. While the decline in construction output has partially narrowed, weak real estate conditions in regional areas persist, according to the analysis.