Business sentiment among South Korean manufacturers improved for a second consecutive quarter, with the Korea Chamber of Commerce and Industry’s Business Survey Index rising 6 points to 86 in the fourth quarter of 2026. The nationwide survey covered 2,413 manufacturing companies. Five industries exceeded the neutral level of 100: semiconductors at 139, cosmetics at 120, medical and precision industries at 108, shipbuilding at 103, and pharmaceuticals and biotechnology at 102. Exporters’ reading rose from 86 to 91, while domestic companies’ index increased from 78 to 85, marking the first simultaneous rise since the third quarter of 2025. Electronics and communications fell 13 points to 80, while steel declined 3 points to 74. Despite improving sentiment, 60.4% of companies expect this year’s operating profit to miss initial targets, mainly because of higher raw material and energy costs.