- POSTED: 09 Jan 2014 11:36
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South Korea's central bank froze its key interest rate for the eighth consecutive month on Thursday, citing signs of modest economic recovery both at home and abroad.
SEOUL: South Korea's central bank froze its key interest rate for the eighth consecutive month on Thursday, citing signs of modest economic recovery both at home and abroad.
The Bank of Korea kept its benchmark interest rate steady at 2.5 per cent. The last rate move was a surprise 0.25 percentage point cut in May to support growth in Asia's fourth-largest economy.
The government last month forecast 3.9 per cent economic growth this year following an expansion of 2.8 per cent in 2013.
In a statement, the bank noted the upward trend in South Korea's all-important export sector, which accounts for more than half of overall gross domestic product.
It also said signs of a US economic recovery had become "more evident" while sluggishness of economic activity in the eurozone had "continued to ease".
Monthly inflation currently stands at around 1.1 per cent, but consumer prices are expected to rise 2.3 per cent this year, leading some analysts to predict an interest rate increase at some point.
But others see the rate remaining stable, or even another cut, citing uncertainty over the US Federal Reserve's stimulus programme, slower emerging markets and export competition caused by a weaker Japanese yen.