Bank of Korea cut benchmark interest rates for a second straight meeting – a surprise move

Bank of Korea cut benchmark interest rates for a second straight meeting in a surprise move:

• Bank of Korea unexpectedly cuts its base rate by 25bp

• first time since 2009 the central bank cut interest rates for two consecutive meetings
• BoK also lowered its forecasts for economic growth and inflation

South Korean won, bond yields weakened. KOSPI caught a wee bid.

More from the BoK now:

• The Bank of Korea will thoroughly assess the impact of the base rate cut on inflation, growth, and financial stability.
• Consumption is expected to continue a moderate recovery.
• Exports growth is likely to fall.
• The Bank of Korea will assess trade-offs among policy variables in determining the pace of further cuts.
• The pace of economic recovery will depend on consumption, the trade environment, and IT exports.
• It is important to remain cautious concerning the potential for high exchange rate volatility.
• The won-to-dollar FX rate has risen considerably.
• Inflation has maintained a stabilization trend.
• The future path of inflation will be affected by FX movements, oil prices, economic growth, and public utility cost adjustments.

This article was written by Eamonn Sheridan at www.forexlive.com.