Bank of Korea holds rates as KRW stability takes priority – UOB Group

The Bank of Korea has decided to maintain the interest rate at 2.50% for the fifth consecutive meeting. This decision stems from Governor Rhee's comments on the importance of currency stability, which acts as a significant constraint on easing policies. The volatility of the South Korean Won (KRW) is a primary concern, emphasizing the necessity of currency stability for economic health. By sustaining the current interest rate, the Bank aims to contain future inflationary pressures, manage import costs, and ensure overall economic integrity. Market reactions suggest a slight appreciation of KRW, as traders continue to assess future policy directions while remaining vigilant towards currency fluctuations, reinforcing the robustness of the South Korean economy.