Morning News & Views - Asia: A Summary of Select Global Markets Research

Research evidence excerpt

Morning News & Views - Asia: A Summary of Select Global Markets Research

hat it remains necessary to continue

raising rates on inflation concerns and heightened financial stability risk amid strong growth. That said, BOK Governor Shin stopped

short of signalling a back-to-back hike in August. He stressed that the timing and pace of further tightening would depend on

incoming data, particularly Q2 GDP and July inflation. Overall, today’s decision confirmed the BOK’s hawkish direction, while the

press conference suggested a more measured pace. We maintain our forecast of two further 25bp hikes, in October 2026 and

January 2027, taking the terminal policy rate to 3.25%. Risk to our view: An August hike remains a risk if inflation and Seoul

housing prices inflation accelerate further and KRW weakness worsens.

Economic Insights - US: Assessing labor market impact of AI

Ruchir Sharma - NSI / Jeremy Schwartz - NSI / Aichi Amemiya - NSI

Labor data to date show only a modest impact from AI. Across postings, hiring, payrolls, and wages, the impact looks muted and

uneven. The limited labor market impact is consistent with past waves of technological changes. Technology is typically disruptive

at the micro level, but, over time, tends to create new roles and expands employment rather than leading to persistent

“technological unemployment. Policymakers remain broadly optimistic about AI’s longer-term labor-market impact. This should keep

officials more focused on inflation, rather than downside labor-market risks. Discussions on AI often focus on the potential for new

technologies to disrupt labor markets. Layoff announcements attributable to AI have picked up lately (Fig. 1), and survey measures

show concerns over job losses have increased (Fig. 2).