Korea: Central Bank holds rates on signs of economic rebound
November 9, 2012
At its 9 November monetary policy meeting, the Bank of Korea (BoK) left the Base Rate unchanged at 2.75%. The decision, which followed a 25 basis points cut in October, was in line with market expectations. The move came on the back of recent signs of a rebound in economic activity, as exports rose for the first time in four months in October. In the accompanying statement, the Bank noted that "exports appear to be emerging from their downtrend and consumption and investment have turned around to increases." On the other hand, the BoK reiterated that the deepening of the Euro area crisis and a weak recovery in the United States continue to pose downside risks to growth. Regarding price developments, the Bank expects inflation to remain within the 3.0% target for the time being amid easing demand side pressures.