VIEW: Goldman Look For Follow Up 25bp Moves

Goldman Sachs note that “the BoK Governor overall characterized the big-step hike as an exceptional and preemptive response to elevated inflation expectations, and commented that the MPC will revert to gradual hikes of 25bp in following meetings barring large deviations in inflation and growth trajectories. He also reiterated that current market expectations of the policy rate reaching 2.75-3.00% by year-end looks reasonable. While today's rate hike was larger than we had expected, future policy rate prospects laid out by the Governor were in line with our expectatio ns. We continue to expect that the BoK will deliver 25bp pace hikes in following meetings (August and October) to reach a terminal rate of 2.75%.”