The mild rise in PPI goods inflation reflects the continued strength of import prices. Services PPI inflation is picking up too, reversing the sharp fall of 1H25. Neither development yet suggests CPI inflation is about to accelerate, but the bounce in services PPI removes downside risk for CPI.

The BOK minutes shed more light on the improvement in cycle optimism that was clear at the November meeting. In terms of exports, that appears justified, because of strong semi exports and firmer profits. I am less sure about consumption, even though corporate earnings will lift bonuses.

The big shift in Korea's BOP since 2020 has been the rise in overseas buying of equities. That outflow surged anew in October to a record high, and by offsetting the large current account surplus, has helped keep $KRW near record highs.

The BOK says the rise in headline CPI inflation to 2.4% the last couple of months is temporary, and that core is stable. That isn't an unreasonable assessment. However, I'd continue to highlight the strength of services inflation, which remains firm reltive to ongoing labour market weakness.

The BOK's revisions to the GDP outlook yesterday were modest. But in today's October output data, there's little sign of any improvement at all. The data are affected by the long Chuseok holiday, and will likely look better through year-end. Still, it is clear the economy still faces headwinds.

The BOK didn't raise growth forecasts above potential, but still signalled some concern about the resilience of inflation. That sounds a touch stagflationary, and was used to justify a step back from its loosening stance. Growth only gets above potential in its chip-driven upside scenario.

I doubt the BOK can raise '26 growth forecasts above its estimate of potential and so shift its loosening stance. What's the wriggle room around that? 1) It says the memory cycle means risks are skewed to the upside 2) Citing financial stability risks, more members suggest rates won't change.

Global factors like US rates and JPY weakness are dragging down the KRW. But there are also local drivers, particularly Korea's big buying of overseas equities. For both the NPS and households, I would expect that to slow, with the reversal likely to be sharp if global markets really sell off.

I don't know nearly enough about tech to decide whether this is a memory supercycle. But it certainly looks like it might be, which raises the possibility that macro in Korea in 2026 could have shades of Taiwan macro in 2025.