The Bank of Korea said on Wednesday that first-quarter real gross domestic product (GDP) growth was tallied at 1.7 percent. The figure was nearly double the bank's first-quarter growth forecast of 0.9 percent presented in February.

Quarterly growth started at minus 0.2 percent in the first quarter of last year, then rose to 0.7 percent in the second quarter and 1.3 percent in the third quarter before slipping to minus 0.2 percent in the fourth quarter. It rebounded sharply in the first quarter of this year.

Exports led growth. They rose 5.1 percent, driven by IT items such as semiconductors. That was the highest since the third quarter of 2020, when they rose 14.6 percent. Imports also increased 3.0 percent, but exports grew more. The contribution from net exports was 1.1 percentage points.

Domestic demand also recovered. Facility investment rose 4.8 percent and construction investment increased 2.8 percent. Private consumption grew 0.5 percent. The overall contribution from domestic demand was 0.6 percentage points.

By industry, manufacturing rose 3.9 percent, the largest increase since the fourth quarter of 2020, when it rose 4.0 percent. Computer, electronic and optical equipment led the increase. Construction also grew 3.9 percent.

First-quarter real gross domestic income (GDI) surged 7.5 percent from the previous quarter. That was the highest since the first quarter of 1988, when it rose 8.0 percent.

The war in the Middle East that began in late February was a downside pressure factor, but an analysis said its impact in the first quarter was limited. A base effect from the sharp drop in the fourth quarter of last year also played a role.