South Korea's Economy Contracts Unexpectedly in Q2

The sharpest shrinkage since late 2022 prompts speculation about imminent interest rate cuts.

GDP fell by 0.2% from the previous quarter, missing the expected 0.1% growth.
Consumer spending and construction investment both declined, while exports saw a modest increase.
The Bank of Korea has maintained its key interest rate at 3.50% for the 12th consecutive meeting.
Economists are divided on whether the central bank will cut rates in August or October.
Strong AI-driven export growth, particularly in semiconductors, is expected to support future economic recovery.