At the monetary policy meeting held on 11 August, the Bank of Korea (BoK) kept the Base Rate unchanged at 3.25%, in a decision that was in line with market analysts' expectations. The BoK refrained from raising rates for a second consecutive meeting, after tightening the policy reins in June. At the current 3.25%, the policy rate is at its highest level since November 2008. According to analysts, the decision to keep rates unchanged was heavily influenced by external factors. In particular, the likelihood of a global economic slowdown adds uncertainty to Korea's growth outlook, given the Korean economy's dependence on exports. Meanwhile, inflationary pressures remain strong, with inflation increasing from 4.4% in June to 4.7% in July on the back of rising prices for agricultural products. In the statement accompanying the decision, the BoK explained that it will conduct its monetary policy with a ?greater emphasis? on ensuring price stability in the coming months. However, market analysts are now uncertain whether the BoK will resume its series of rate increases before the end of the year.
Korea Monetary Policy
Central Bank stays put in August
August 11, 2011
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Korea Economic News
October 13, 2016
At its 13 October monetary policy meeting, the Bank of Korea (BoK) announced that it will hold the base rate constant at a record low of 1.25%, which was largely in line with market expectations.
October 5, 2016
In September, consumer prices rose 0.6% over the previous month, which contrasted the 0.1% decrease in August and overshot the 0.2% increase the markets had expected.
October 3, 2016
Korea’s Customs Services reported that exports totaled USD 40.9 billion in September, which represented a 5.9% contraction over the USD 43.4 billion recorded in the same month last year.
September 30, 2016
The forward-looking business confidence indicator (BSI) for the manufacturing sector produced by the Bank of Korea (BoK) rose from 74 points in September to 75 points in October.
September 30, 2016
In August, industrial production accelerated and expanded 2.3% year-on-year, which was up from both the 1.6% increase registered in July and the 1.6% rise the markets had expected.