The Bank of Korea’s monetary policy board Thursday froze the base interest rate at a record-low 1.5 percent, citing soaring household debt, volatility in the China market and low crude prices.

The central bank also announced that it slashed its growth outlook for 2016 to 3 percent from 3.2 percent. In its previous quarterly revision, released in October, the central bank lowered the forecast to 3.2 percent from 3.3 percent.

The BOK said it decided to keep the key rate unchanged largely due to the nation’s skyrocketing household debt.

As of Sept. 30, South Korea’s total household debt soared to 1,166 trillion won ($962.8 billion), growing at an accelerated pace of 10.4 percent in 2015 from 8.7 percent in 2011.

The central bank has stood pat on its policy rate since June after the U.S. Federal Reserve raised the key interest rates for the first time in a decade last month.

BOK has cited lackluster economic conditions as the main reason for maintaining its current monetary policy.

A fall in crude oil prices have had a negative impact on the Korean economy, which depends largely on exports.

Prices are expected to remain lower on slow global trade and Iran’s imminent reentry into the crude market in the first quarter of this year.

Recent stock routs in China is also raising concerns about their impact on the global economy. 

By Chung Joo-won (joowonc@heraldcorp.com)