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BOK leaves key rate on hold

BOK leaves key rate on hold

(13 June 2014 – South Korea) South Korea’s central bank left its key rate unchanged on 12 June, holding the seven-day repurchase rate at 2.5 percent for the 13th straight month.

The won had gained around 12 percent against the United State’s dollar over the past year, meaning hard times for the nation’s exports.

Bank of Korea (BOK) governor Lee Ju Yeol said in May the stronger currency and sentiment hit by the deadly ferry disaster may increase hardship for businesses.

South Korea Finance Minister Hyun Oh Seok urged companies to expand hiring and investment to boost growth.

The economy is expected to lose some steam, so the interest rate will remain accommodative in the near term.

It is expected the BOK will raise the rate in September or later in the year as inflation begins to creep up.

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