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KDI FOCUS Enhancing the Prudential Framework for Securities Firms

To enhance risk sensitivity, the NCR framework should revert to its pre-2016 structure for large firms and adopt tailored regulations for smaller firms.

December 17, 2025
Economic Outlook KDI Economic Outlook 2025-2nd Half

The Korean economy is expected to grow by around 1.8% in 2026, as export growth slows but domestic demand recovers.

November 11, 2025
KDI News What‘s Up Newsletter Vol.28

The 28th issue of the KDI What's Up newsletter is now available!

December 16, 2025
KDI FOCUS Improving Regulations on Abuse of Superior Bargaining Position by Digital Platforms

In regulating the unfair practices of online platforms, it is necessary to improve the institutional framework by alleviating the burden of identifying victims and considering the potential for enhancing the efficiency of platform intermediation.

October 22, 2025
KDI NEWS 2025 Knowledge Exchange Days (KED) Event Successfully Concludes with Vibrant Participation

Hosted by the Ministry of Economy and Finance (MOEF) and managed by the KDI GKEDC Operating Team, successfully took place on November 6-7, focusing on “Integrated Solutions for Climate Action”

December 09, 2025
KDI FOCUS The Impact of Demographic Change on Household Debt

Korea's household debt-to-GDP ratio, which has risen over the last two decades due to intergenerational asset and housing accumulation, is expected to reverse as population aging slows longevity gains, requiring coordinated financial and labor reforms for stability.

August 05, 2025
KDI News 2025 KDI GKEDC Capacity-Building Program

Enhancing Sustainable Urban Mobility in Cambodia

September 22, 2025
KDI FOCUS Health Insurance Expenditure Growth: Driving Factors and Policy Implications

To curb soaring primary care prices requires reforming fee-for-service and strengthening expenditure review.

April 21, 2025
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Summary

Monthly Economic Trends KDI Monthly Economic Trends 2026. 1
■ Overall production in the Korean economy continues to expand at a modest pace, underpinned by improving consumption, even as weakness in construction persists and manufacturing undergoes some adjustment.
　 　 　
　 ○ Construction activity remains in sharp contraction and continues to act as a primary constraint on the pace of economic recovery.
　
　 ○ Semiconductor-related export values maintain strong growth amid favorable market conditions; however, this performance largely reflects sharp price increases, while previously elevated production growth has moderated.
　 　 　
　 - Meanwhile, as production outside the semiconductor sector sustains only modest growth, manufacturing business sentiment remains at low levels.
　 　
　 ○ However, consumption continues to improve, with retail sales maintaining modest growth and services production showing signs of recovery.
　 　 　
　 - The Composite Consumer Sentiment Index (CCSI) remains at a relatively elevated level, while business sentiment in non-manufacturing sectors continues to improve.
　 　 　
　 - Despite ongoing weakness in construction and manufacturing, growth in the number of employed persons has edged up slightly, led by services.

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025.12
■ The Korean economy continues to exhibit a modest improvement led by consumption, while weakness in the construction industry persists.
　 　 　
　 ○ Although weakness in the construction industry has been prolonged, consumption continues to improve as the effects of base rate cuts feed through with a lag and government support measures remain in place.
　 　 　
　 ○ As a result, services production remains solid, supporting a modest increase in all-industry production.
　 　 　
　 - Employment in sectors closely linked to consumption also shows a gradual easing of weakness.
　 　 　
　 ○ Meanwhile, export growth expanded due to favorable semiconductor conditions, although trade-related uncertainty persists.
　 　 　
　 - Trade in non-semiconductor items weakened somewhat amid high U.S. tariff rates.
　 　 　
　 - Semiconductor exports remain robust, but part of their strength reflects the surge in prices; in volume terms, the previously strong gains are gradually moderating.
　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025.11
■ Despite weak construction investment and slower export growth, the Korean economy shows signs of a modest improvement, led by consumption.
　 　 　
　 ○ The semiconductor sector remained buoyant, but export growth gradually slowed due to negative spillover from U.S. tariff hikes. Construction investment also continued to lose momentum.
　 　 　
　 - With exports to the U.S. declining steadily and weakness persisting in non-semiconductor items, average daily exports showed a modest slowdown.
　 　 　
　 ○ However, consumption has been recovering gradually, supported by lower market interest rates and policy measures to stimulate spending.
　 　 　
　 - As a result, services production continued to improve, particularly in sectors tied to domestic demand, such as wholesale and retail trade.
　 　 　
　 ○ Meanwhile, although trade conditions have improved somewhat,with progress in KoreaU.S. trade negotiations and easing U.S. China trade tensions, uncertainty persists.
　 　 　
　 　 　
　
　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025.10
■ The Korean economy continued to show weak growth in overall production, weighed by contraction in the construction sector, while weakness in consumption appears to be easing
　 　 　
　 ○ The prolonged downturn in the construction sector continues to weigh on all-industry production growth, while employment also slowed, particularly in that sector.
　 　 　
　 ○ However, manufacturing indicators improved, as continued high growth in passenger car retail sales is driving a surge in motor vehicle output.
　 　 　
　 - Other retail sales also showed a gradual easing of weakness,supported by declining market interest rates and government consumption support measures.
　 　 　
　 ○ Meanwhile, downside risks to economic activity persist, as indicated by deteriorating global trade conditions.
　
- High tariffs on Korean motor vehicle exports to the U.S. remained in place, while trade uncertainty has increased, as indicated by renewed tensions between the U.S. and China.
　 　 　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 9
■ The Korean economy, despite weak construction investment, is showing some easing of overall sluggishness, led by consumption.
　 　 　
　 ○ Construction investment remains sluggish, while equipment investment growth is moderating, with manufacturing capacity utilization still at low levels.
　 　 　
　 ○ However, the weakness in consumption is slightly easing as market interest rates continue to decline and government consumption support policies are implemented.
　 　 　
　 ○ Downward pressures on exports remain elevated, reflecting persistently high U.S. tariffs and heightened global trade uncertainty.
　 　 　
　 - Exports continue gradual growth led by semiconductors, but with tariff hike effects starting to emerge, including declining shipments to the U.S., earlier front-loading may unwind, potentially slowing export growth.
　
　 - Uncertainty also lingers over the possibility of tariffs on semiconductors
　 　 　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 8
■ The Korean economy continues to record low production growth, weighed down by sluggishness in the construction sector, although consumption conditions have shown partial improvement.
　 　 　
　 ○ Construction investment continued to decline significantly, and growth in equipment investment is also experiencing adjustment.
　 　 　
　 ○ Nevertheless, consumption conditions are improving, supported bya continued decline in market interest rates and consumption stimulus measures.
　 　 　
　 ○ While trade uncertainty has eased following the conclusion of trade negotiations between the U.S. and major economies, high tariffs continue to weigh on exports.
　 　 　
　 - While export growth has remained modest, the risk of a slowdown is considered elevated, as the front-loaded effect―mainly in semiconductors―diminishes and the impact of tariff hikes begins to materialize (see Box, p.8).
　 　 　
　
　 　 　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 7
■ The Korean economy remains at a similarly subdued level as in the previous month, due to continued weakness in the construction sector and worsening external conditions.
　 　 　
　 ○ Construction remains depressed, while manufacturing is experiencing a downturn, dampening production growth.
　 　 　
　 - Semiconductor exports and production continued to underpin favorable trend, while investment in related equipment sustained high growth.
　 　 　
　 - However, exports to the U.S. weakened, particularly in categories such as motor vehicles affected by steep tariff hikes, resulting in slower growth in manufacturing production.
　 　 　
　 - All industry production turned to a decrease as construction output contracted and services posted only modest growth.
　 　 　
　 ○ While consumer sentiment is on the mend, pointing to a possible improvement in domestic demand conditions, trade-related uncertainty remains elevated with the expiry of the mutual tariff suspension approaching.
　 　 　

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 6
■ The Korean economy remains subdued overall, weighed down by continued weakness in the construction sector and a slowdown in exports under the impact of U.S. tariff hikes.
　 　 　
　 ○ Construction investment continued to decline, while exports also showed weakening momentum.
　 　 　
　 - Weakness in construction investment is constraining the recovery in domestic demand, while overall production growth is slowing, particularly in the construction sector.
　 　 　
　 - Exports weakened further, particularly in sectors more directly affected by U.S. tariffs, as reflected in a decline in motor vehicle exports to the U.S.
　 　 　
　 - Meanwhile, persistent strength in semiconductor demand has supported continued robust growth in production, exports, and investment in related equipment.
　 　 　
　 ○ Meanwhile, while household and business sentiment showed modest improvement amid easing domestic political instability and the U.S.-China trade agreement, external uncertainty remains elevated.
　 　 　
　 - Trade-related uncertainty continues to run high, driven by further increases in steel and aluminum tariffs and lingering concerns over a potential resurgence of U.S.-China trade tensions.