Invest2 publishersIndependently confirmed2 min readPublished
Global banks expect Korea's chip-driven growth to slow faster next year than the Bank of Korea does
Eight global banks raised their average 2026 growth forecast for South Korea to 3.5% in September, a sixth monthly rise, on surging chip exports. At 2.8% for 2027, just under the Bank of Korea's 2.9%, they expect a sharper slowdown than the central bank does.
The Investor · Invest desk
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What happened
- Chip shipments passed $60 billion in September for the first time, roughly half of the month's record exports of $120.94 billion.
- The banks' 2026 average stood at 2 percent at the end of last year, then rose to 2.1 percent in January, 2.4 percent in April and 2.8 percent in May.
- JPMorgan holds the highest 2026 forecast of the eight banks, 4 percent, up from 3.8 percent a month earlier.
- Second-quarter GDP grew 0.6 percent on the quarter, against the Bank of Korea's May projection of 0.2 percent.
- The OECD raised its 2026 estimate for Korea to 3.7 percent, up 1.1 points since June and the largest upward revision among G20 economies.
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Why it matters
- constraint The banks have nearly caught up with the central bank on 2027, so any further upgrade to next year now depends on new chip data.
- exposure With one product supplying half of exports, a single weak month of chip shipments would pull down the 2026 and 2027 forecasts together.
- decision Anyone reading the bank consensus as a bet on a lasting boom has to account for a 2027 forecast that already builds in a steeper slowdown than the central bank's.
Most of September's move came from two banks. UBS added 0.7 point and Bank of America 0.5 [4][5]. Spread across eight banks, those two revisions lift the average by 0.15 point, about three-quarters of its rise from 3.3 to 3.5 percent [19][1].
The Korea Center for International Finance figure is an average in the Korea Herald's account and a median in Yonhap's [1][7]. If it is a mean, the four banks the reports name average about 3.7 percent. The other four must then average about 3.3 percent, level with the Bank of Korea's own forecast for this year [20][11].
The banks and the central bank differ on the shape of the next two years. The banks sit 0.2 point above the Bank of Korea for 2026 and 0.1 point below it for 2027 [24]. Their path has growth slowing by 0.7 point next year, against the central bank's 0.4 [21]. The central bank also moved further on 2027. It raised its projection by 0.8 point, against the 0.3 point the banks' 2027 average gained in September, and two of the eight banks did not raise their 2027 forecasts at all [22][2].
Momentum is the case for a longer boom. According to Yonhap, the banks expect the global chip cycle to stay stronger and more resilient than previously anticipated [9]. Their 2026 average has climbed 1.5 points since the end of last year [12]. The expectation rests on one product. September's 83.5 percent year-on-year rise puts the same month of 2025 near $65.9 billion, so exports grew by about $55 billion in a year [14][23]. That increase is a little smaller than this September's chip shipments alone [15].
If chip shipments hold at September's level, the banks' 2027 average probably passes 2.9 percent, and the banks were simply late in catching up with the central bank. If shipments flatten, the 2026 figure survives on growth already booked, including 1.8 percent quarter-on-quarter in the first quarter [16], while the 2027 numbers stall. A sharp fall in a single month would cut both years together, with chips making up half of exports [15].
I'd expect the middle case, because the banks' own forecasts already build in the larger slowdown [21]. That view is wrong if the 2027 average rises past 2.9 percent while this year's holds at 3.5. The KCIF figures are forecasts by bank economists, and the reports do not cover the won, Korean equities or the policy rate [1].
What to watch
- October export data, and whether chip shipments stay above the $60 billion first reached in September.
- Whether the banks' 2027 average moves past the Bank of Korea's 2.9 percent in the next KCIF tally.
- The third-quarter GDP estimate, the first quarterly figure to include September's record export month.