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Moody's Analytics expects BOK to hold policy rate steady in October

By Yonhap
Published : Oct. 14, 2017 - 11:33
South Korea's central bank is likely to hold its key rate steady this month as soft domestic demand could keep monetary policy accommodative in the near term, a leading provider of economic analysis said Saturday.

The Bank of Korea is set to hold its rate review session Thursday to decide whether to keep or adjust the all-time low rate of 1.25 percent.


(Yonhap)

Still, Moody's Analytics said in a report that the South Korean government's stimulus measures such as the proposed 7.1 percent on-year spending increase in the 2018 budget and concerns about record high household debt "could prompt a faster than expected rate hike cycle next year."

South Korea's overall household debt came to 1,388.3 trillion won ($1.22 trillion) as of end-June, up 10.4 percent from a year earlier, according to data compiled by the BOK.

In June, BOK Gov. Lee Ju-yeol said the central bank may take a monetary tightening approach if the economy shows signs of a robust recovery. (Yonhap)

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