VIEW: J.P.Morgan Reaffirm Base Case

In the wake of yesterday’s BoK decision J.P.Morgan maintain their “previous call that the BoK will hike by 25bp at each meeting through October (July, August, and October), along with a 25bp hike in Q123 to 2.75%, which will be the terminal policy rate for this cycle, with more conviction for hikes in July and August meetings. The pencilled-in hike actions in Q422 (25bp in October) and Q123 (25bp in January) should depend on whether the inflation trend stabilizes towards the target bound (as measured by three-month trend) and if the GDP growth trend remains above the potential rate. Yet, as we see lingering upside risk to the inflation outlook, we believe that upside risk to our terminal rate forecast should be greater than downside risk.”