South Korea: Rate cut delayed, not denied – ANZ

The Bank of Korea (BoK) paused amidst a divided consensus to take stock of the numerous policy measures implemented last month, economists at ANZ Bank apprise. USD/KRW is trading at 1218.32.

Key quotes

“The BoK kept its policy rate unchanged at 0.75% as policymakers paused to take stock of measures implemented last month. Two members of the board also dissented in favour of a cut.”

“The BoK highlighted unambiguously the deterioration in the economic outlook. It expects both growth and inflation to fall below its February projections (2.1% and 1.0%, respectively) by a tall margin. Governor Lee also pointed to the ‘high possibility’ of South Korea facing a recession.”

“Given the severe growth downturn facing the economy, the next rate cut could be as soon as in May.”