Korea – cost-push for now

Underlying inflation was firm in September, because of energy, and the surge in semiconductor prices raising the price of electronics devices. September data show the chip shock isn't over yet, and the BOK expects demand-pull inflation to also become more obvious in the coming months.

Paul Cavey

Oct 2, 2026 • 3 min read

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East Asia Today

Japan's Tankan was strong enough for faster rate hikes, though likely not at the October meeting. Korea's positive terms of trade shock remains intense, with exports surging again in September. The details of Taiwan's PMI were weaker than the headline, but price pressures are rising again.

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Japan – faster, but not that fast

The Tankan survey suggests nominal growth stronger at the margin, but not gaining a lot of new momentum. The tone of the summary of opinions of the September meeting looks similar: likely faster rate hikes, but no sense of the sort of urgency that would make October a live meeting.

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East Asia Today

Not unusually, China's PMIs in September were mixed – a picture consistent with yesterday's announcement of incremental policy support. IP and retail sales in Japan fell in August, partly because of temporary factors. Korea data were also weaker last month, but that followed strength in June-July.