SEOUL (Reuters) – South Korea’s central bank said on Friday its interest rate policy next year would continue to target containing inflation, which it said is expected to slow though a huge amount of uncertainty lies ahead.
“The Bank of Korea will continue to conduct its monetary policy with a focus on price stability so that consumer price inflation will move toward the target level of 2.0%,” it said in an annual policy statement, required by law.
It has said inflation would fall to 3.6% in all of next year after hitting 5.1% this year, the highest since 1998, but saw it hovering around 5% in the early part of 2023.
It has lifted the policy rate by 275 basis points since late last year in nine steps to 3.25% and is widely expected to be finishing its tightening cycle this year, earlier than some other central banks.
In Friday’s statement, it said it would decide on the final rate in the cycle and how long to stay there after taking into account inflation, economic growth and financial and foreign exchange market situations.
(Reporting by Choonsik Yoo; Editing by Kenneth Maxwell)
