{"id":3141,"date":"2023-04-07T00:38:04","date_gmt":"2023-04-07T00:38:04","guid":{"rendered":"http:\/\/lynettelockhart.com\/client\/bank-of-korea-to\/"},"modified":"2023-04-07T00:39:55","modified_gmt":"2023-04-07T00:39:55","slug":"bank-of-korea-to","status":"publish","type":"post","link":"http:\/\/lynettelockhart.com\/client\/bank-of-korea-to\/","title":{"rendered":"Bank of Korea to hold base rate at 3.50%, may cut by end of year – Reuters poll"},"content":{"rendered":"

By Anant Chandak<\/p>\n

BENGALURU (Reuters) – The Bank of Korea will opt to support a rapidly slowing economy by holding its main interest rate at 3.50% on Tuesday, according to a Reuters poll of economists that showed a slim majority now expect a 25-basis-point cut by the end of 2023.<\/p>\n

Policymakers at the BoK, who have raised rates by 300 basis points since August 2021, are wary of overtightening an export-dependent economy that is on the brink of a recession, especially when global growth is also slowing.<\/p>\n

Inflation eased to a one-year low of 4.2% in March, but it is still double the BoK’s 2% target and not expected to get to that level for at least another year.<\/p>\n

All but one of 40 economists in the April 3-6 Reuters poll expected no change to the 3.50% base rate, already the highest since late 2008, at the April 11 meeting. Only one forecast a 25-basis-point hike to 3.75%. <\/p>\n

“The Bank of Korea has become less hawkish and is almost certain to leave interest rates unchanged,” said Dave Chia, an economist at Moody’s Analytics.<\/p>\n

“Considering weak consumption and high household debt, further rate hikes would be devastating to lower-income earners and economic growth. The recent easing of inflation is good news, but volatile oil prices still present a risk.”<\/p>\n

BoK Governor Rhee Chang-yong told reporters after the February monetary policy meeting that the central bank would not resume its rate hikes if inflation continued to moderate.<\/p>\n

The risk of a prolonged economic slowdown has fuelled market bets that the central bank will cut rates by the end of the year. While a majority of economists in the poll expected the base rate to remain at 3.50% until the end of the third quarter, just over half forecast at least one rate cut by the end of 2023.<\/p>\n

The BoK’s decision to pause policy tightening is in line with several other major regional central banks who have paused their post-pandemic tightening cycles, such as the Reserve Bank of Australia and the Reserve Bank of India.<\/p>\n

South Korea’s economy was expected to grow 1.2% in 2023 and 2.3% in 2024, while inflation was forecast to average 3.3% this year and 2.0% next year.<\/p>\n

(For other stories from the Reuters global long-term economic outlook polls package:)<\/p>\n

\n

(Reporting by Anant Chandak; Polling by Devayani Sathyan and Veronica Khongwir; Editing by Hari Kishan, Ross Finley and Paul Simao)<\/p>\n

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By Anant Chandak BENGALURU (Reuters) – The Bank of Korea will opt to support a rapidly slowing economy by holding its main interest rate at 3.50% on Tuesday, according to a Reuters poll of economists that showed a slim majority now expect a 25-basis-point cut by the end of 2023. Policymakers at the BoK, who […]<\/p>\n","protected":false},"author":8,"featured_media":3142,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":""},"categories":[1216],"tags":[],"class_list":["post-3141","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-u-s-economy"],"jetpack_featured_media_url":"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportEconomy\/tagreuters.com2023binary_LYNXMPEJ3600O-VIEWIMAGE.jpg","_links":{"self":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/3141","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/comments?post=3141"}],"version-history":[{"count":1,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/3141\/revisions"}],"predecessor-version":[{"id":3143,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/3141\/revisions\/3143"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media\/3142"}],"wp:attachment":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media?parent=3141"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/categories?post=3141"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/tags?post=3141"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}