South Korea raises policy rate
Governor cites rising household debts and house prices as reasons to tighten policy
The Bank of Korea raised its base rate by 25 basis points to 0.75% on August 26, making it the first major central bank in Asia to tighten policy this year.
South Korea’s year-on-year inflation rate was 2.6% in July. The central bank has a medium-term target of 2%. The first time this year that inflation rose above 2% was in April, when it reached 2.3%.
The bank’s monetary policy board agreed to raise rates by a majority vote of five to one. Joo Sang-yong was the only dissenter, as he called
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