韩国银行：应对疲弱增长的基调微妙转变

Jin ChoiEconomist, Korea & TaiwanThe Hongkong and ShanghaiBanking Corporation Limitedjin.h.j.choi@hsbc.com.hk+852 2996 6597Economics-DataReactionsKorea ◆◆◆ 1 2much of the recent movement to(market expectations around)the recenttariffandcurrency discussionsbetween the US and itscounterparts.ImplicationsAwell-expecteddecision andrevisionin outlook…Today’s25bp cut wasanon-event.TheBoard hadclearlycommunicatedincreaseddownside riskstogrowthandaccordinglysignalled that another cut was imminent initsApril meeting.Inour previewlast week, weargued that market would instead watch thedegree of growth andinflation downgrades, in order togaugehowlow and fast the BoK’s policy rate could eventually go.In this regard, wethink that today’ssteep downgrade in 2025growthwaslargely in line withmarketexpectationsas well(HSBCexpectedc0.9%)–eventhoughthe downwardrevisionsfor 2026were somewhat limited(seeBankof Korea Watch:The degree of shift in policy focus towards growth, 23 May).… though theoverall toneremainedrather cautious.Despite the significant downgradein 2025 growth,however,we thinktheBoard soughtto managetheshiftin itstonetowards the dovish siderathercarefully. This is because:The BoK thinks Korea’s growth could be bottoming out:Table2showstheBoK’supdatedquarterly projectionfor realGDP growth–whichshows thatthe BoKthinks 1Q25likely marked the trough. Specifically, Governor Rhee mentioned thatprivate consumptionlikely troughed in 1Q25 and willrecover going forward, given thelowerinterest rates and diminisheddomestic policy uncertainty which couldbe a positive for consumer sentiment (Chart 1).Construction capexis also expectedto trough over2H25asits correction over the past four quarters is likely coming to an end. In turn,domestic demand isexpected tocontinueits recovery andleadto the overall growth recovery in 2026.Besides, Governor Rheealsocommentedthatthe below-1% growthfor this year,in spite of being low,shouldstillbeviewed in the context ofKorea’s slowing potentialgrowth.Table 1:Real GDP forecasts, quarterlySource:BoK,HSBCThe Boardis concerned not tounderminefinancial stabilitythrough itsmonetaryeasing:Governor Rheedevotedmuch of the press briefingtodiscussing factors which could go againstthe BoK’s excessive easing.Interms oftheongoingcorrection inconstruction capex, heargued thatthe lower-rateenvironment of the past had fuelledtheover-supplyofhousingby constructors,especially in the regions.He alsoexpressed concerns that, given the relatively ample liquidityconditionsof now,further easing and provision of liquidity could be directed to the less-productive property market andtrigger household leveraging.This would be especially sogiven uncertainty around the newgovernment’s policy directionspost the 3 June presidential election(Chart 2).On FXwheretheBoardacknowledged thatrisks have somewhat subsided lately,Governor Rheealsocommentedthat it ishard to predict future movements. In his view, much of the recent KRW appreciation has beendue tothe recentstabilisationin domestic politics (meaning therecould belessroom for further appreciation),while uncertaintyremains higharoundtheUS’tariffpolicyand related negotiations, theFed’s futuretrajectory, and the recentmarket movement related to theweakeningsenseof theso-calledUSexceptionalism.We seerising downside risks to our monetary policy forecast.All in all,we note thatthat today’s revisions bring the BoK’sgrowth forecasts closer to ours (0.7%/1.4% for 2025/2026).However, as discussedabove, wealsosense that theBoard’sreactionfunction could be remaining somewhathawkish,in favour ofensuringfinancialstability.Also given the recent developmentson theUS’bilateraltariffnegotiations(not only withKorea but alsowith mainland Chinaand other economies), more resilientUS labourmarket and likely more hawkish Fed, and clearer signs of amore imminent and material expansion indomesticfiscal policypost theelection(seeKorea election preview:Look out for a swift shift in fiscal policy, 28 May), we seerising risksthat the BoK’songoingmonetary policy easing may not go as deep/fast as we currently expect (1.50% by 2Q26).1Q242Q243Q244Q241Q252Q25f3Q25f4Q25f1Q26f(% y-o-y)3.32.31.51.2-0.10.41.21.62.1(% q-o-q, sa)1.3-0.20.10.1-0.20.50.70.60.3 4Disclosure appendixAnalyst certificationThe following analyst(s), who is(are) primarily responsible for this document, certifies(y) that the opinion(s), views or forecastsexpressed herein accurately reflect their personal view(s) and that no part of their compensation was, is or will be directly orindirectly related to the specific recommendation(s) or views contained in this research report: Jin ChoiThis document has been prepared and is being distributed by the Research Department of HSBC and is intended solely for theclients of HSBC and is not for publication to other persons, whether through the press or by other means.This document does not provide individually tailored investment advice and should not be construed as an offer or the solicitationof an