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MNI BoK Preview - October 2023: On Hold, Policy Bias Likely To Stay Restrictive

EXECUTIVE SUMMARY

  • The BoK is widely expected to hold rates steady at 3.50%. Focus is likely to be on the BoK's policy bias, which should stay restrictive/open to another hike, given still elevated inflation pressures. Market pricing is roughly around a full +25bps within the next 6 months.
  • Financial stability concerns are also likely to feature, although macroprudential policies may be the preferred path to deal with higher household debt levels.
  • The BoK is likely to be encouraged by some signs of improving external demand, but elevated uncertainty is still likely to feature in terms of how the central bank describes the outlook.
  • See the full preview here:
  • BoK Preview - October 2023.pdf


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