Korean bank leaves rate intact
South Korea’s central bank has been being holding its 1.5% rate steady for up to nine months. It didn’t change it on Thursday, too, in spite of huge pressure to drastically ease the country’s monetary policy and stimulate growth.
The given decision undoubtedly indicated everlasting caution at the country’s major financial institution regarding lowering rates, following downside risks, because a further easing of monetary policy could give investors an idea to transfer more cash abroad, thus exacerbating the Asian country’s already impressive levels of national debt.
The Wall Street Journal has recently surveyed up to 24 financial analysts and 13 of them expect the country’s central bank to keep its repurchase rate unchanged this month. Others predict April’s rate cut or somehow later this year.
February’s exports sagged 12.2%, thus contributing to a 14th monthly slump. China, taking in a quarter of Korea’s shipment overseas, is currently demonstrating lower economic growth, thus ruining hopes for a rapid recovery in Korean exports to China.