Korea

Research evidence excerpt

Korea

mid-100s, suggesting households have large- 17

ly looked through recent equity-market weakness and

12 10 renewed geopolitical noise, supported instead by a better out- Real GDP

7 look for living conditions and income. Hard consumption

data were mixed: June retail sales rebounded, led by a sharp 2

rise in auto sales alongside stronger auto production, while 0

Non-farm -3 non-auto sales posted a more modest gain helped by durables

all-industry output -5 -8 (boosted by promotions) and softer semi-durables. Even with

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 the June bounce, the sequential trend in retail sales remains

Source: BoK, NSO, and J.P. Morgan * Dotted lines are JPM forecast

weak, consistent with a consumption mix that has been more

services-led than goods-led in 2Q amid energy-related head-

Non tech led June IP rebound winds for goods demand.

Industrial production jumped 6.4% m/m, sa in June, material-

ly stronger than expected and beyond a mechanical rebound Investment data were more constructive in June, with facility

after the April–May declines. The upside reflected a broad- investment rising strongly and broad-based gains across key

based recovery in non-tech output and shipments, consistent categories such as vehicles, ICT, and electrical machinery,

with firmer domestic demand conditions and an easing of the alongside continued strength in domestic machinery orders.

crude-import disruptions that weighed on parts of manufac- While the sequential capex trend has mechanically cooled

turing earlier in 2Q. With the June level now elevated, some from the February peak, it remains robust relative to the 2Q

payback in July is possible, but the June rebound provides a GDP capex print, and survey evidence continues to support