Analysts at TD Securities note that the Bank of Korea Kept its policy rate unchanged at 1.50% in line with TD’s and consensus expectations.
“This follows the surprise 25bp interest cut in July. BoK noted they will maintain an accommodative stance. BoK highlighted downside risks to CPI, expecting it to move around 0% ‘for a while’. They also noted an increase in uncertainty over the growth path.”
“We think BoK wants to evaluate the impact of the previous cut before moving again. Given their concerns about growth and weakening inflation pressures we expect the next cut to take place in October.”