South Korea's Ministry of Economy and Finance published its Recent Economic Trends report, assessing that the economy is continuing a recovery supported by improving domestic demand and strong semiconductor-led exports, while noting persistent employment difficulties in vulnerable sectors and rising uncertainty around external trade conditions. In November 2025, mining and manufacturing production, service industry production, facilities investment and construction investment increased, while retail sales fell. All-industry production rose 0.9% month-on-month and 0.3% year-on-year, with mining and manufacturing up 0.6% month-on-month, construction up 6.6% and services up 0.7%. Retail sales declined 3.3% month-on-month, while facilities investment increased 1.5%. Exports in December 2025 increased 13.4% year-on-year, with daily average exports at USD 2.90 billion, up 8.7%. December consumer sentiment fell to 109.9, down 2.5 points month-on-month, while the all-industry business survey index rose to 93.7, up 1.6 points, and the January 2026 outlook declined to 89.4, down 1.7 points. Employment growth slowed to 168,000 year-on-year in December 2025 and the unemployment rate rose to 4.1%, up 0.3 percentage points, while inflation eased with consumer prices up 2.3% year-on-year and core inflation up 2.0%. Financial markets in December saw stock prices and government bond yields rise and the exchange rate fall, while housing transaction and jeonse prices increased month-on-month to 0.26% and 0.28%. The report highlighted large month-to-month volatility from base effects and holiday timing, uncertainty over the recovery in construction investment, and potential impacts from US tariff measures, alongside concerns that global tariff and geopolitical pressures could increase financial market volatility and slow trade and growth. It called for proactive macroeconomic policy and sector-level efforts to support consumption, investment and exports, alongside swift implementation of the 2026 economic growth strategy.
Ministry of Economy & Finance (South Korea) 2026-01-16
South Korea's Ministry of Economy and Finance flags continuing recovery while highlighting labour market strains and tariff risks
South Korea's Ministry of Economy and Finance reports ongoing economic recovery driven by domestic demand and semiconductor exports, despite employment challenges and external trade uncertainties. The report emphasizes the need for proactive macroeconomic policies and sector-level efforts to bolster consumption, investment, and exports amid potential global tariff and geopolitical pressures.