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Bank of Korea keeps benchmark interest rate steady at 0.5%
Updated: 2021-02-25 10:08:27 KST
South Korea's central bank has kept its benchmark interest rate unchanged at a record low of point-five percent.
The decision was made during the central bank's monetary policy meeting on Thursday.
The rate freeze comes as the bank aims to maintain its expansionary policy to offset the economic fallout from the COVID-19 pandemic.
The Bank of Korea cut its key interest rate to point-seven-five percent last March and lowered it once more to a record-low point-five percent in May last year.
It's been maintaining the rate at point-five percent since then.
The central bank on Thursday also kept its GDP growth forecast for South Korea this year at 3 percent, the same as the previous forecast made in November last year.
The growth forecast for 2022 was also the same as the previous forecast, at 2.5 percent.
This comes despite the recent recovery in exports.
An expert says the unchanged forecast is likely due to consumption in face-to-face services still remaining sluggish due to the recent third wave of the pandemic, and as economic uncertainty still remains.

"It's true that there are some positive signs from exports. But the Economic Optimism Index, which measures the outlook on the economy, cannot improve with uncertainties clouding the economy."

The central bank also forecast inflation of 1.3 percent this year and 1.4 percent in 2022.
Kim Jae-hee, Arirang News.
Reporter : jhee@arirang.com