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South Korea raises interest rates 0.75%

South Korea raises interest rates 0.75%

Mubasher: The Bank of Korea (BoK) has raised its benchmark rate to 0.75% on Thursday, 26 August, increasing the seven-day repurchase rate by 25 basis points from a record low of 0.50%.

South Korea has now become the first big Asian economy to raise interest rates since the pandemic started, the Financial Times reported.

It also marked the country’s first rate rise since September 2018, while interest rates have remained unchanged since the BoK cut them by 50 basis points in May 2020.

South Korea is on track for a gross domestic product (GDP) growth of 4% in 2021.

The BoK’s decision has reportedly raised debate over whether central banks in other Asian countries might soon follow suit earlier than expected.