Economic Buzz: Bank Of Korea Hikes Key Rate By 25Bps

25 Aug 2022 , 12:34 PM

The Bank of Korea opted for a smaller rate hike on Thursday, after delivering a record half percentage points increase last month, as downside risks to growth escalates amid high inflation. The Monetary Policy Board of the Bank of Korea decided to hike the Base Rate by 25 basis points to 2.50 percent from 2.25 percent. The bank has raised its interest rate by 50 basis points in July for the first time in its history. The rate has been tightened by altogether 200 basis points in the current tightening cycle that began in August 2021. The central bank has downgraded its growth outlook for this year to 2.6 percent from 2.7 percent projected in May. Similarly, the forecast for 2023 was lowered to 2.1 percent from 2.4 percent as exports are set to weaken due to the global economic slowdown.Powered by Commodity Insights