Bank of Korea Cuts Repo Rate for Second Time this Year
June 11, 2015
The MERS threat and global challenges such as “changes in the monetary policies of major countries, the weakening of economic growth in emerging market countries, and uncertainties over the restructuring of Greek debt” persuaded Korean monetary authorities to cut the seven-day repo rate by 25 basis points to 1.50% according to an accompanying statement by the Monetary Policy Committee. Earlier 25-basis point cuts occurred in May 2013, August and October 2014, and March 2015. “The Committee notes that the trend of decline in exports has accelerated and that consumption, which had been showing a recovery, appears to have contracted since the outbreak of Middle East Respiratory Syndrome (MERS).” From a 15-year low of 0.4%, CPI inflation edged up to 0.5% in May but is expected to hover “at a low level” for now.
Copyright 2015, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Korea
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