The Bank of Korea held its benchmark interest rate steady at 2.5 percent Friday, citing volatility in the Korean won and rising inflationary pressures linked to the Iran conflict.
The decision comes as the won remains under pressure amid heightened geopolitical tensions, with oil price swings driven by the Middle East crisis adding to uncertainty in global markets.
Although the currency briefly strengthened below the 1,500-per-dollar level for the first time in 10 trading days on Wednesday, closing daytime trading at 1,470.6 per dollar, depreciation pressure persists.
The won was quoted at 1,475.1 per dollar at the opening of onshore trading Friday, up 7.4 won from the previous session.
The Iran conflict has also intensified inflation concerns in Korea, which is heavily reliant on energy imports and vulnerable to external price shocks. Higher global oil prices are expected to feed into domestic costs, adding upward pressure on consumer prices.
Friday’s rate-setting meeting marked the last for Governor Rhee Chang-yong, who is set to step down on April 20. Governor nominee Shin Hyun-song is expected to chair future meetings after taking office.
silverstar@heraldcorp.com
