A Third South Korean Central Bank Rate Cut – Currency Thoughts

A Third South Korean Central Bank Rate Cut

February 25, 2025

South Korea’s Base Rate peak of 3.5% had been maintained from January 2023 until an initial cut last October. That incremental reduction of 25 basis points was followed by another in November but not changed at this year’s first Bank of Korea policy review. But easing resumed today via a cut to 2.75% from 3.0%. In undertaking this third cut, which markets had been led to expect, officials wrote, “Although concerns about foreign exchange markets still remain, inflation stabilization has continued along with an ongoing slowdown in household debt, while the growth rate is forecast to decline significantly.” The latest South Korean inflation reading of 2.2% was close to the 2.0% target.

Copyright 2025, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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on Tuesday, February 25th, 2025 at 8:12 am and is filed under Central Bank Watch.
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