Fed's hawkish hold strengthens case for BOK's hike in November
The U.S. Federal Reserve's hawkish decision to hold interest rates steady has strengthened the case for the Bank of Korea (BOK) to raise its benchmark rate as early as next month, as stronger-than-expected growth and persistent inflation reinforce the need for further monetary tightening, analysts said Thursday. The Fed kept its benchmark interest rate unchanged at 3.75 to 4 percent on Wednesday…
The Federal Reserve's decision to maintain interest rates steady has bolstered the argument for the Bank of Korea (BOK) to increase its benchmark rate as soon as November, according to analysts. Despite the U.S. central bank's announcement of keeping its benchmark rate at 3.75 to 4 percent on Wednesday, they indicated inflation remains elevated and reiterated their commitment to reducing it to the 2 percent target.
This has kept investors focused on a potential Fed rate increase in December, which could prompt the BOK to undertake additional tightening measures before the U.S. counterpart acts. The BOK maintained its benchmark rate at 3 percent during its rate-setting meeting last Thursday, stating they require more time to evaluate both domestic and international economic conditions and the impact of the previous two rate hikes.
However, recent economic data have supported the need for further tightening. Korea's real gross domestic product expanded by 1 percent in the third quarter.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Fed's hawkish hold strengthens case for BOK's hike in November koreatimes.co.kr
