BoK makes surprise 25bp cut to base rate

Majority of monetary policy board decides risks to growth warrant loosening in policy

Rhee Chang-yong
Rhee Chang-yong
IMF/Stefani Reynolds

The Bank of Korea today (November 28) said it was cutting its policy rate by 25 basis points to 3%.

In a press conference, the bank’s governor Rhee Chang-yong said the decision had been finely balanced, with two of the monetary policy board’s seven members voting to maintain the base rate at 3.25%.

He said that although inflation had continued to stabilise, increasing downward pressure on growth meant a cut was necessary to “mitigate downside risks to the economy”.

Rhee said that although domestic

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