Limited damage: Shipping containers sit stacked in Uiwang. Exports have rallied, business confidence has strengthened and optimism prevails among consumers in South Korea as vaccination picks up. ― Bloomberg
SEOUL: South Korea raised interest rates yesterday, becoming the first major Asian economy to start exiting record-low borrowing costs as financial risks are seen to pose a bigger threat to the economy than the latest virus wave.
In a statement released after a quarter-percentage-point hike to 0.75%, the Bank of Korea (BoK) said it will “gradually adjust” the degree of support for the economy, taking into account Covid-19 developments, financial imbalances and other factors. The central bank kept its growth forecast for this year unchanged from May, but raised its inflation outlook above target to 2.1%.
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