Bank of Korea seen holding rates as next cut delayed to 2027 (poll)

The Bank of Korea (BoK) is expected to hold its base rate at 2.50% during its meeting on January 15, according to a Reuters poll of 34 economists. Concerns about weak currency and inflationary pressures limit the room for further easing. The won has weakened nearly 2% this year, potentially leading to higher import prices, complicating the inflation outlook. While South Korea's inflation rate eased to 2.1% in 2025, it remains above the BoK's 2% target, contributing to a hesitance in resuming rate cuts. The central bank indicated it may be nearing the end of its easing cycle and has shifted its forward guidance to a more cautious stance on potential cuts. With South Korean housing prices showing upward trends, the BoK faces increasing pressure to maintain currency stability and manage asset price risks. Looking ahead, the economy is expected to grow by 2.0% in 2026, suggesting a restrained approach rather than urgency in monetary policy adjustments.