The Asian Development Bank (ADB) forecast Korea's economic growth this year at 1.9%. Citing a "semiconductor industry boom," it revised the outlook up by 0.2 percentage points after four months. However, it projected inflation at 2.3%, up 0.2 percentage points, due to the fallout from the "Middle East war."
According to the Ministry of Economy and Finance on Apr. 10, the ADB released its "April 2026 Asian economic outlook" containing these details.
The ADB raised this year's growth outlook for Korea (1.9%) from its December forecast (1.7%), saying it reflects "increased exports driven by a semiconductor industry boom, a gradual rise in consumption due to the delayed effect of interest rate cuts, and expected effects from expanded government expenditure in strategic sectors such as semiconductors, defense, and bio." The ADB projected next year's growth at the same 1.9%.
This year's inflation (2.3%) was revised up from the December forecast (2.1%). The ADB said this was "due to expected increases in international oil and commodity prices stemming from Middle East tensions, a weak won, and higher electronics prices."
The ADB's outlook was analyzed based on a scenario in which Middle East tensions stabilize early within a month.
International organizations including the ADB are collectively revising up their inflation forecasts for Korea to reflect the impact of the Middle East war. The Organisation for Economic Co-operation and Development (OECD) recently raised its projection from 1.8% to 2.7%, and the ASEAN+3 Macroeconomic Research Office (AMRO) from 1.9% to 2.3%. For this year's growth, most are predicting the upper 1% range: OECD 1.7%, AMRO 1.9%, and ADB 1.9%.
Meanwhile, the ADB raised its growth outlook for developing countries in the Asia-Pacific region from 4.6% to 5.1% and inflation from 2.1% to 3.6%. However, if Middle East tensions persist through the third quarter, it expects inflation to surge to 5.6% and economic growth to fall to 4.7%.