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South Korea keeps interest rates steady for 4th month in Oct

by ChemOrbis Editorial Team - content@chemorbis.com
  • 13/10/2016 (14:55)
According to media reports, South Korea’s central bank, Bank of Korea (BOK) kept its interest rate at a record low of 1.25% for a fourth straight month on Thursday due to an upsurge in household debt.

Most economists’ expectations were for rates to remain unchanged at 1.25% due to the risks of rapidly increasing household debt in a survey conducted by Reuters.

The bank estimated the country’s growth rate at 2.7% for 2016 and at 2.9% for 2017 but they discuss revising their economic forecast for this year.

"Markets are expecting a downward revision for next year’s growth outlook, due to Samsung Electronic’s decision to terminate the Galaxy Note 7 and the anti-graft law," a fixed-income analyst at NH Investment & Securities, Peter Park said.

Annual inflation increased to 1.2% in September, recording the highest rate in seven months.
Law makers have blamed the BOK’s interest rate cuts for growing household debt. Many analysts forecast that the central bank will keep the interest rate steady throughout the next year.
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