US Output and Labor Costs – Q3 2025, Initial Estimate

Samsung Electronics fell more than 6% at one point, as the company failed to announce a new shareholder return plan, disappointing investors. The Korea Kospi index dropped 1.2%, while Nasdaq 100 index futures fell 1.1%. The yield on the rate-sensitive 2-year US Treasury declined by 2 basis points to 4.68%, and the 10-year Treasury yield also fell by 2 basis points to 5%. Spot gold dropped 0.7% to around $4,040 per ounce. Brent crude fell below $110 per barrel, trading at $109.98 per barrel.

Driven by the AI chip boom, a massive inflow of US dollars has caused the Korean won to surge by 13% in Q3. Hwang Kunil, a dovish member of the Bank of Korea, warns that the benefits of this round of appreciation are highly uneven: leading large companies profit while default rates among small and medium-sized enterprises are rising. Although the strong exchange rate helps curb inflation, it also weakens exports and exacerbates domestic demand weakness, putting the central bank, which maintains a 3% interest rate, in a dilemma between stabilizing prices and supporting the real economy.