Bank of Korea Hikes Interest Rates to 3% Amid Inflation Pressure
· Business · CNBC, Economic Times, MarketWatch
The Bank of Korea raised its benchmark interest rate by 25 basis points to 3% on Thursday, marking its highest level since January 2025. The central bank implemented its second consecutive rate hike as core inflation climbed to 2.6% in July, reaching its highest reading since December 2023. Headline inflation cooled slightly to 2.8% in July but had risen steadily from February through June following the onset of the conflict involving Iran. The BOK noted that sustained cost pressures and rapid housing price acceleration in Seoul prompted the tightening measures. South Korean housing prices in Seoul jumped 2.5% month-on-month in June, marking the highest increase in five years.
Why it matters
The rate hike addresses persistent core inflation and rising housing prices in South Korea, signaling tighter monetary conditions for borrowers and businesses.
Read the original report — CNBC
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