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MNI BOK WATCH: Board Maintains Restrictive Stance, Cuts Delayed

(MNI) Tokyo
(MNI) TOKYO

The BOK board decided to hold the policy rate steady Thursday and pushed back notions of imminent cuts.

Bank of Korea Governor Rhee Chang-yong Thursday maintained his cautious view on the outlook for inflation, stressing increased uncertainty on the timing of a rate cut, following the board's unanimous decision to hold the Base Rate at 3.5%.

Rhee noted a policy-rate reduction would weaken the won further and destabilise financial markets. “The upside risks to the inflation outlook have increased since April and we need more time to gain confidence in the convergence of the inflation target,” he said.

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Bank of Korea Governor Rhee Chang-yong Thursday maintained his cautious view on the outlook for inflation, stressing increased uncertainty on the timing of a rate cut, following the board's unanimous decision to hold the Base Rate at 3.5%.

Rhee noted a policy-rate reduction would weaken the won further and destabilise financial markets. “The upside risks to the inflation outlook have increased since April and we need more time to gain confidence in the convergence of the inflation target,” he said.

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