Korea’s central bank on July 12 froze its key rate for July as the economy shows some signs of a slowdown and inflationary pressure remains low.
The monetary policy board of the Bank of Korea voted to keep the critical rate unchanged at 1.5 percent as widely expected, extending its wait-and-see stance to eight months.
In November last year, Korea’s central bank adjusted up the key rate for the first time in more than six years, citing economic recovery.
Disappointing economic data seems to have nudged the BOK to make its latest decision although many analysts had earlier expected a rate hike in July.
The central bank said it will downgrade its earlier growth forecast of 3 percent for 2018 and maintain an expansionary monetary policy for a while.
“Going forward the board expects domestic economic growth to be slightly below the path projected in April but to sustain a rate at its potential level,” the BOK said in a release.
“As it is forecast that inflationary pressures on the demand side will not be high for the time being, while the domestic economy is expected to continue its solid growth, the board will maintain its accommodative monetary policy stance,” it added.
By Song Seung-hyun and newswires (email@example.com