Bank of Korea policy decision - meeting the consensus expectation for a hike.
- monetary policy board of the Bank of Korea first rate-setting meeting of this year
- benchmark seven-day repo rate raised to 1.25%
- the previous board meeting in November also saw a 25bp hike
- 1.25% is now back at the pre-pandemic level (ie before March 2020)
South Korean economic background to today's decision is:
- strong exports
- growing inflation, driven up by global supply disruptions and a rebound in consumption
- CPI +3.7% y/y in December (marking 3 straight months of inflation rising more than 3%
- 2021 consumer inflation rose 2.5%, fastest in 10 years
- The BOK's medium range targets 2%
