Korea cuts again

The Bank of Korea has slashed interest rates for the sixth time in four months, bringing the cost of borrowing to a record low of 2% and suggesting that further cuts could be in store.

The central bank, which acknowledged for the first time that the economy is likely to shrink this year, said on Thursday that it would monitor the affects of its dramatic rate-cutting spree totalling 3.25% since October, but left the door open to further easing.

The cut was in line with market expectations.