Bank of Korea

Bank of Korea

October 13, 2016

Policymakers at the Bank of Korea did not raise their one-week repo rate of 1.25%, a record low, in spite of a tripling of CPI inflation to 1.2% in September and a projection that positive growth will continue in the vicinity of 3%. In a statement released after the October policy meeting, officials stressed the […] More

Bank of Korea

September 9, 2016

The Bank of Korea continues to employ an accommodative monetary stance. Inflation is too low. On-year consumer prices rose 0.4% overall and 1.1% on core components. Both rates were lower than in July. Regarding growth, a statement released today “forecasts that the domestic economy will sustain its trend of modest growth going forward, owing chiefly […] More

Bank of Korea

August 11, 2016

South Korea’s Base Rate, which had been cut in June for the first time in a year but was left unchanged after July’s monthly policy meeting, was again not changed following the latest review. A statement again reaffirmed the view that inflation, now under the 1-3% target range at 0.7%, will continue to be low for […] More

Bank of Korean Base Rate Kept at 1.25%

July 14, 2016

A fifth 25-basis point interest rate cut since August 2014 had been implemented at the June monthly policy review, so it’s not surprising that Bank of Korea officials chose to leave the Base Rate steady this time at 1.25%.  In a released statement, Board members predicted modest domestic demand-led growth with considerable uncertainty surrounding that […] More

Surprise Central Bank Rate Cut in South Korea

June 9, 2016

The Bank of Korea’s Base Rate was sliced 25 basis points to 1.25%.  This first rate change in a year was made “to ensure that the recovery of economic growth continues and consumer price inflation approaches the target level over a medium-term horizon.”  Exports are still contracting, and domestic growth since April has evolved more […] More

Market Pessimism Returns

June 9, 2016

Central bank action overnight accentuated the negative. ECB President Draghi made another plea for badly needed structural reform and fiscal support, and he warned of lasting damage to potential growth in the region of prolonged very weak growth with persisting deflationary risks. ECB Governor Villeroy defended very low interest rates as necessary to counter insufficient […] More

Bank of Korea

April 19, 2016

A 1.5% seven-day repo rate was retained yet again.  In the Great Recession, the rate was lowered to 2.0% but raised subsequently to 3.0% by July 2010.  The last six changes were all cuts of 25 basis points spaced between November 2012 and June 2015.  The last of these was decided by a unanimous vote.  […] More

Bank of Korea

March 10, 2016

The South Korean central bank’s seven-day repo rate was left at 1.50%, its level since a 25-basis point reduction in June 2015.  There had been five earlier 25-bp cuts in November 2012, May 2013, August 2014, October 2014 and March 2015.  A statement released after this month’s meeting of the Monetary Policy Board observes that […] More

Euro Rises on ECB Announcements

March 10, 2016

The ECB Governing Council announced a more aggressive package of stimulants than analysts were expecting. All ECB central bank interest rates including the main refinancing rate were lowered. The size of monthly quantitative asset purchases was increased 33% to EUR 80 billion and will run at least through end-2017. The types of eligible assets in […] More

Bank of Korea

February 16, 2016

The seven-day repo rate was left at 1.5%, its level since a 25-basis point cut last June.  Five such reductions were spaced out between May 2013 and June 2015.  Monetary officials, who meet monthly, released a statement, projecting sub-trend, domestic demand-led growth and low inflation.  Considerable attention is being devoted to “external risk factors such […] More

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