Central Bank of South Korea raises key rate to highest level in 15 years
The Bank of Korea (the Central Bank of the Republic of Korea) was forced to raise its key rate by 25 basis points to 3.5 percent as the economy still comes under inflationary pressure: the highest since 2008 – according to the information published on the website of the financial regulator
It is noted that with this measure, the Bank of Korea’s monetary policy committee hopes to achieve price stability in the country, since inflation remains very high.
Moreover, experts underline the slowdown in the South Korean economy. According to forecasts, in 2023 the country’s GDP will increase by less than 1.7 percent – this figure was expected in November last year.
However, according to the Bank of Korea, the economic situation in the country should normalise by the end of this year.
It is known that inflation in the Republic of Korea in December 2022 was 5 percent, its main driving factors were the increase in prices for semi-finished food products and the increase in tariffs for gas and electricity.