BOK Hikes Interest Rate to 0.75%
26 August, 2021
The Bank of Korea on Thursday raised the base interest rate by 0.25 percentage point to 0.75 percent.
The hike was the first since the era of zero interest began. The rate had been at 0.5 percent for 15 months, which led to runaway borrowing.
There have been mounting expectations that the central bank would hike the rate despite mounting uncertainties due to a renewed surge in coronavirus infections. BOK Governor Lee Ju-yeol recently said interest rates will have to rise to rein in surging household debt and the real estate and stock market bubbles.
The BOK kept its four-percent growth forecast for this year unchanged from May but raised its inflation outlook to 2.1 percent from 1.8 percent.
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