East Asia Econ

Korea – narrow cycle, but still improving

Business sentiment in today's BOK survey returned to the level that has historically divided loosening and tightening cycles. Tomorrow, the bank will likely raise its 2026 growth forecast to above its 2% estimate of potential. The rates market has already priced this, but the currency can move more.

Paul Cavey

Feb 25, 2026 • 4 min read

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East Asia Today

Highlights of a longer note summarising Korea's cycle before the BOK meeting tomorrow. Also today, Korea's IIP position in 2025, as well as services PPI inflation in Japan and labour market data for Taiwan in January.

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East Asia Today

A few charts from a longer slidepack looking at the remarkable changes in Taiwan's economy since 2020, details of consumer confidence and PPI in Korea, and export volume data for Japan for January.

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Korea – consumer confidence and PPI

The continued strength of consumer confidence in today's February survey might be hinting at a broader cyclical upturn. At the same time, house price expectations eased. CPI expectations were stable at 2.6%, and likewise, today's PPI for January doesn't point to a big near-term change in inflation.