KDI says South Korea's recovery has yet to reach households broadly

South Korea's export and investment recovery has yet to translate into a broad improvement in household purchasing power, the Korea Development Institute said Monday.

In its October assessment, the state-run institute linked the constraints on consumption to subdued underlying wage growth and supply-side inflation pressures. Persistently high oil prices remain one of those pressures.

The institute nevertheless judged that the economy was maintaining its recovery momentum. Manufacturing output continued to expand, while strong global demand for artificial intelligence infrastructure supported exports and equipment investment.

South Korea's September exports rose 83.5% from a year earlier to a record $120.9 billion. Semiconductor shipments exceeded $60 billion for the first time in a single month.

Alongside chips and computers, demand for AI infrastructure supported exports of steel products and nonferrous metals. The institute stressed, however, that households had not yet broadly shared in the benefits of the industrial recovery.