The Bank of Korea is expected to keep its base rate unchanged at 3.00% through the October and November meetings, even as the inflation-growth mix is described as less favourable. Underlying inflation is characterised as sticky, while growth is framed as being driven by AI and semiconductors. Financial conditions have also tightened following a sharp correction in the KOSPI, which is presented as reinforcing the case for a pause.
Rate Outlook and Drivers
The outlook nevertheless includes two increases later in the cycle: a 25bps hike in early 2027 and a further 25bps move in H1-2027, taking the terminal rate to 3.50% by end-2027. The balance of risks is portrayed as shifting towards a potential move in November, and attention is set on the October decision for any change in the risk assessment. The article states it was produced with an AI tool and reviewed by an editor.
