{
  "id": 13903643,
  "title": "(2nd LD) BOK chief says back-to-back rate hikes bought time to respond to financial risks",
  "url": "https://urgent.news/2026/10/12/2nd-ld-bok-chief-says-back-to-back-rate-hikes-bought-time-to-respond",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-12T07:45:11.000Z",
  "source": {
    "name": "Yonhap News",
    "slug": "yonhap-news",
    "url": "https://en.yna.co.kr/view/AEN20261012002652320"
  },
  "original_language": "en",
  "account": "Bu Kim Boram, the head of the Bank of Korea (BOK), stated on Monday that the central bank's consecutive interest rate hikes provided time to address potential financial risks. Governor Shin Hyun-song explained that the bank had raised interest rates earlier than other major countries, asserting that they had bought some time. The BOK increased the benchmark interest rate to 3% during two successive meetings in July and August, aiming to prevent inflation from escalating further. Shin emphasized the importance of acting promptly, drawing a comparison to the proverb \"To block something with a shovel that could have been blocked with a hand hoe.\" He noted that the back-to-back rate hikes were unprecedented and sent a strong market signal, aiding authorities in preemptive response to avoid greater fluctuations. Yields on Korean government bonds remained relatively stable over the past two to three weeks, according to Shin. Despite the pain caused by rate hikes, acting preemptively helps stabilize the market and ultimately reduces overall costs. However, Shin expressed regret that the central bank did not adequately warn about the volatility and potential investor losses from single-stock leveraged ETFs launched in May. Such ETFs, associated with Samsung Electronics and SK hynix, significantly impacted the domestic stock market. Financial authorities subsequently imposed strict measures to curb volatility. Regarding overseas artificial intelligence (AI) service subscriptions, Shin mentioned that the central bank would seek ways to incorporate accurate data into national statistics, as South Korea had a $6.4 billion deficit in intellectual property services in the first half, primarily driven by software copyright payments. The BOK forecasted continued solid economic growth, with a projected growth rate of 3.3% in 2026 and 2.9% in 2027, driven by robust semiconductor exports. The country's gross domestic income (GDI) increased by 13.2% in the first quarter and 15.7% in the second quarter of 2026, compared to 3.5% in the fourth quarter of 2025. Consumer prices are expected to stay above the 2% target due to strong exports and investment, as well as supply chain disruptions from the Middle East crisis, prompting the BOK to closely monitor inflation and economic trends.",
  "summary": "SEOUL, Oct. 12 (Yonhap) -- The head of the Bank of Korea (BOK) said Monday the c...",
  "key_points": [
    "BOK chief Bu Kim Boram says back-to-back rate hikes bought time to address financial risks",
    "Governor Shin Hyun-song explained interest rates raised earlier than other major countries",
    "BOK forecasted solid economic growth at 3.3% in 2026 and 2.9% in 2027"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}