South Korean GDP Unexpectedly Shrinks, Boosting Rate Cut Chances

KOREA SELATAN - SEOUL. South Korea's economy unexpectedly shrank in the second quarter, clocking the sharpest contraction since 2022 as slumping consumer spending undermined an export boom, reinforcing expectations that an interest rate cut could be imminent.

Gross domestic product (GDP) for the April-June period fell 0.2% from a quarter earlier in seasonally adjusted terms, data from the Bank of Korea showed, missing a 0.1% gain seen by analysts in a Reuters poll. It was the sharpest fall since the fourth quarter of 2022.