Bank of Korea to assess inflation, growth for rate hikes, board member says

The Bank of Korea's board member announced on Tuesday that the central bank will decide on the timing and speed of future interest rate hikes by thoroughly evaluating inflation, economic growth, and financial stability. In the future, factors such as the build-up of financial imbalances, sector-specific income growth, global market conditions, and geopolitical risks may influence financial stability, said Chang Yong-sung in a statement accompanying the central bank's financial stability report.

To avert the deepening of financial imbalances, Chang emphasized the necessity of employing monetary and macroprudential policies together, while seeking coordination between fiscal and financial authorities to address challenges faced by vulnerable groups. The Bank of Korea (BOK) increased its benchmark interest rate by a quarter percentage point to 3.00 percent on August 27, marking a second consecutive hike, as inflation remained above the target and financial stability risks persisted.