Bank of Korea Keeps Key Rate at 2.0%

April 9, 2009

As expected, the Bank of Korea left credit policy unchanged for a second consecutive month and left no hint that it is poised to cut rates further soon. The central bank’s website talks of downside growth risks, declining inflation, and lower house prices but also observes some signs of improved conditions related to the won and stock prices.  The 2.0% seven-day repo rate is called “accommodative.” To get to that level, monetary officials cut rates twice in October by a total of 100 basis points and followed those moves with cuts of 25 basis points last November, 100 bps in December and 50 bps each in January and February.

Copyright 2009 Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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