Bank of Korea

July 13, 2017

Thirteen months have passed since the last base rate change in South Korea, and although central bank officials bumped projected 2017 economic growth up somewhat to 2.8%, the base rate was left at 1.25%. Five cuts spaced out from April 2014 to June 2016 had previously halved the policy interest rate. A statement released today observes continuing weakness in personal consumption, a lack of demand-pull pressure on prices, CPI inflation close to the 2% target and core inflation of about 1.7%. The statement observes greater household debt and a recent rise of the won and long-term interest rates. Geopolitical tensions are mentioned but not specifically North Korea’s testing of an ICBM.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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