The International Monetary Fund’s Executive Board completed its 2025 Article IV consultation for South Korea, projecting economic growth of 0.9% in 2025 and 1.8% in 2026 as private consumption recovers in the second half of next year and uncertainty surrounding domestic politics begins to ease. Inflation is expected to remain close to the Bank of Korea’s (BOK) 2% target, while financial stability risks are considered manageable. The IMF said ROK authorities have sufficient policy space and are simultaneously implementing measures to support demand while tightening macroprudential controls to address housing-market pressures.

The IMF warned that uncertainty around the outlook