#BankOfKoreaHikesRatesTo3% NEW: đ°đ· Bank of Korea raises interest rates by 25 BPS to 3.00%, marking its second consecutive rate hike.
Economists were almost evenly split ahead of the decision, with only 18 of 35 surveyed by Reuters expecting a hike.
This comes just weeks after South Koreaâs KOSPI suffered one of its worst crashes since the 2008 financial crisis, falling ~40% from its June peak.
Despite the historic selloff, the BOK massively raised its 2026 GDP growth forecast from 2.6% to 3.3%, driven by stronger-than-expected semiconductor exports and investment.
At the same time, inflation remains elevated, with July CPI at 2.8% versus the central bankâs 2% target.
The KOSPI initially dropped ahead of and shortly after the decision, then briefly recovered before falling back below 6,850. It later rebounded again and closed up 1.53% on the day.
And further rate hikes remain on the table.
The BOKâs latest projections show 3.25% as the most likely interest rate over the next six months, with some policymakers seeing rates reach 3.50%.
South Korea is hiking rates into one of its most volatile stock market periods in decades.$AKE $ONT $PLAY
Economists were almost evenly split ahead of the decision, with only 18 of 35 surveyed by Reuters expecting a hike.
This comes just weeks after South Koreaâs KOSPI suffered one of its worst crashes since the 2008 financial crisis, falling ~40% from its June peak.
Despite the historic selloff, the BOK massively raised its 2026 GDP growth forecast from 2.6% to 3.3%, driven by stronger-than-expected semiconductor exports and investment.
At the same time, inflation remains elevated, with July CPI at 2.8% versus the central bankâs 2% target.
The KOSPI initially dropped ahead of and shortly after the decision, then briefly recovered before falling back below 6,850. It later rebounded again and closed up 1.53% on the day.
And further rate hikes remain on the table.
The BOKâs latest projections show 3.25% as the most likely interest rate over the next six months, with some policymakers seeing rates reach 3.50%.
South Korea is hiking rates into one of its most volatile stock market periods in decades.$AKE $ONT $PLAY
