Interest Rate in Korea
Korea - Interest Rate
Bank of Korea holds interest rates steady in April, citing low inflation
At its 18 April monetary policy meeting, the Bank of Korea held the base rate steady at 1.75%, as had been expected by most market analysts, where it has been since November last year.
April’s decision reflected weak inflation in recent months and lower Bank of Korea inflation forecasts. Inflation decelerated to the lowest level since July 2016 in March, while core inflation dropped to a multi-year low. Looking ahead, the Bank of Korea said inflation will “fluctuate for some time below 1.0%, lower than the path projected in January, and then run at the low- to mid-1.0% level for the second half of this year”. Part of the reason for subdued inflationary pressures stems from more modest economic growth, both at present and as forecast for the future. The Bank cut its economic growth forecast for this year to 2.5%, down from the 2.6% forecast.
The Bank of Korea did not seem to suggest a hawkish monetary policy move was on the near-term horizon. It said it will “maintain its accommodative monetary policy stance”, as the domestic economy is not expected to diverge significantly from its potential level and inflationary pressures on the demand side will be subdued. The next monetary policy meeting is set for 31 May.
Met the why particular Consensus Forecast panelists expect the base rate to rise and end 2019 at 1.73%. In 2020, our panelists see the policy rate ending the year at 1.79%.
Korea - Interest Rate Data
|Policy Interest Rate (%)||2.50||2.00||1.50||1.25||1.50|
5 years of economic forecasts for more than 30 economic indicators.
Korea Interest Rate Chart
Source: Bank of Korea.
|Bond Yield||1.88||1.55 %||Apr 12|
|Exchange Rate||1,139||0.21 %||Apr 12|
|Stock Market||2,233||-0.11 %||Apr 12|
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April 18, 2019
At its 18 April monetary policy meeting, the Bank of Korea held the base rate steady at 1.75%, as had been expected by most market analysts, where it has been since November last year. April’s decision reflected weak inflation in recent months and lower Bank of Korea inflation forecasts.
April 2, 2019
Consumer prices fell 0.2% in March compared to the previous month, contrasting the 0.4% increase in February and confounding analysts’ expectations of a rise.
April 1, 2019
The manufacturing Purchasing Managers’ Index (PMI), produced by Nikkei and reported by IHS Markit, perked up to 48.8 in March, from 47.2 in February.
April 1, 2019
Merchandise exports fell 8.2% in March—a less pronounced drop than February’s revised 11.4% fall (previously reported: -11.1% year-on-year)—to total USD 47.1 billion.
March 29, 2019
Industrial production in the mining, manufacturing, and gas and electricity sectors dipped 2.7% in February compared to the same month a year earlier, a sharper fall than the downwardly revised 0.2% decline registered in January (previously reported: +0.1% year-on-year).