Bank of Korea
South Korea's economy grows 1 percent in 2025
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South Korea's gross domestic product grew 1 percent in 2025 from the previous year, according to Bank of Korea data, but the fourth quarter saw an unexpected 0.3 percent contraction. Strong exports drove the annual figure despite weakness in construction. This marks half the 2 percent expansion of 2024.
South Korea's producer price index (PPI) rose 0.6 percent from a month earlier to 122.56 in February, marking the sixth consecutive monthly increase due to higher agricultural costs and global oil prices, Bank of Korea data showed. A key gauge of future consumer inflation, the index was up 2.4 percent year-on-year, the fastest growth since July 2024.
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Bank of Korea Deputy Governor Yoo Sang-dai stated that uncertainty over the US Federal Reserve's rate path has deepened following the latest FOMC decision to hold benchmark rates at 3.5-3.75% for a second consecutive meeting, amid persistent Middle East instability. The BOK will monitor risks closely and act if needed to stabilize markets.