Bank of Korea trims interest rates after holding for almost two years

Pedestrians were seen crossing a road in front of the Bank of Korea headquarters in Seoul, where South Korea’s economic growth unexpectedly picked up in the second quarter despite poor exports. The central bank recently cut its benchmark interest rate by 25 basis points to 3.25%, the first rate cut since the Federal Reserve started tightening its policy earlier in the year. This decision was in line with economists’ forecasts, as South Korea’s inflation rate fell to 1.6% in September, below the BOK’s target of 2%. The bank noted that inflation has stabilized, prompting a slight moderation in its restrictive monetary policy. Experts believe this could be the start of a broader rate cut cycle, with predictions of further cuts to come in the future.