Bank of Korea holds rates after President Lee calls for boosting housing supply

Economists polled by Reuters had forecast the Bank of Korea to hold rates.

Bank of Korea holds rates after President Lee calls for boosting housing supply

TL;DR

  • The Bank of Korea (BOK) kept its policy rate unchanged at 3%.
  • This decision follows two consecutive rate hikes.
  • Analysts indicate the pause doesn't signal a change in policy stance due to persistent inflation.
  • President Lee Jae Myung has called for an 'all out effort' to boost housing supply.
  • The BOK is assessing the impact of prior rate hikes and monitoring domestic and external risk factors.
  • Inflation in South Korea was 2.9% in September, staying above the BOK's 2% target for 13 months.
  • Housing-related loans are increasing, and housing price growth in Seoul and surrounding areas is accelerating.
  • One more rate hike is anticipated by some economists at the next BOK meeting.
  • South Korea's economic growth is supported by exports, particularly semiconductors, which surged in September.
  • The IMF projects South Korea's growth at 3.3% for 2026.