South Korea's central bank warns that massive bonuses from the semiconductor boom could fuel broader inflation.

South Korea's central bank has issued a rare warning that substantial performance bonuses resulting from the storage chip business cycle could spill over from the semiconductor industry to broader sectors, potentially pushing up inflation pressure. As employee bonuses at Samsung and SK Hynix grow significantly, luxury consumption around chip manufacturing has visibly accelerated, with retail stocks such as Shinsegae, Lotte Shopping, and Hyundai Department Store being speculated as "storage concept stocks" by investors. The Bank of Korea currently projects that the country's overall inflation rate this year could reach 2.7 percent, well above the 2 percent policy target. As a result, the Bank of Korea's policy meetings in July or September have emerged as critical windows for potential rate increases.