Another Rate Hike at the Bank of Korea

January 14, 2022

Officials at the Bank of Korea are the latest to hike a central bank interest rate in this young year of 2022, lifting such by an as-expected 25 basis points to 1.25%. This third such advance since August 2021 reverses all of the early 2020 rate reduction and returns the rate to its pre-pandemic level. South Korean monetary policymakers served notice that rate normalization is not yet completed: “The Board will appropriately adjust the degree of monetary policy accommodation as the Korean economy is expected to continue its sound growth and inflation to run above the target level for a considerable time, despite underlying uncertainties over the virus.”

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