East Asia Econ

East Asia Today

Japan's quarterly MOF and Cabinet Office survey showed business sentiment declining, but the labour market still tight and capex intentions firm. Korea's 10-day exports were strong again, especially in KRW terms, another sign of the huge nominal income growth Korea is currently experiencing

Paul Cavey

Jun 11, 2026 • 2 min read

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Korea – huge nominal growth

Korea is experiencing a large positive terms of trade. As that isn't being accompanied by any KRW appreciation, the result is enormous growth in KRW nominal indicators. Not all sectors are benefiting. But for monetary policy, the strength of nominal growth is impossible to ignore.

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East Asia Today

PPI inflation in China continues to rise, but CPI is constrained. Imported upstream inflation is even stronger in Japan, but export prices are rising too. The same chip boom that is boosting Japan's export prices is feeding into wages in Korea. TSMC sales rose again in May.

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Korea – not totally K-shaped

The corporate surplus is surging, and at first glance, that supports the idea that the semi-led cycle won't trickle down. However, while the labour share is falling, the rise in national incomes has been so strong that growth in labour compensation is accelerating. That should support spending.