BOK Holds Benchmark Interest Rate at 2.5%
Summary
- The Bank of Korea's Monetary Policy Board said it held the benchmark interest rate at 2.5%%.
- Governor Shin Hyun-song said he may signal a future benchmark rate increase, citing sharply rising inflation and solid growth.
- The Bank of Korea raised its economic growth forecast for this year to 2.6%% from 2.0%% and projected next year's consumer inflation at 2.7%%.
Forecast Trend Report by Period
The Bank of Korea held its benchmark interest rate at 2.5% at a Monetary Policy Board meeting on May 28.
Uncertainty surrounding the war in the Middle East was cited as the main reason for the decision. The conflict, which began in late February with US and Israeli airstrikes on Iran, has entered a third month as ceasefire negotiations face last-minute hurdles.
Still, Governor Shin Hyun-song may use his first press briefing to signal a possible rate increase later, citing sharply rising inflation and solid economic growth.
The BOK raised its forecast for this year's economic growth to 2.6% from 2.0%. It projected growth of 2.1% for next year.
The central bank forecast consumer inflation at 2.7% next year and 2.3% in 2027.
Shim Seong-mi, Hankyung reporter, smshim@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
