S Korea's key rate stays frozen for 6th consecutive month
- Source: Xinhua
- [13:22 August 11 2009]
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South Korea's central bank on Tuesday announced that it decided to keep its interest rate frozen for the sixth straight month, citing lingering uncertainties over the economy.
According to the Bank of Korea (BOK), it decided to leave the nation's benchmark seven-day repo rate at the current level, record low of 2 percent during its monthly policy meeting.
"In the coming months, the Korean economy is likely to maintain its positive on-quarter growth trend, but uncertainties persist," the BOK said in a statement.
Although consumer prices are likely to take an upturn, but the amount of the increase is expected to be limited, the BOK added.
Given such economic risks, the BOK said it will keep up with its accommodative monetary policy for the time being, further focusing on promoting economic growth and stabilizing the financial markets.
The central bank's move came amid expectations that the key rate would remain as is with experts pointing out that it is too early for the BOK to stand back from its monetary stance, local media said.
According to local economists, the BOK may revise up the rate as early as next year on the condition that it gradually absorbed liquidity in the market by reversing unconventional measures it took in the midst of the global financial crisis.
