LOC15:08
12:08 GMT
TOKYO, May 26 (KUNA) -- South Korea's central bank (the Bank of Korea or BoK) raised its key policy rate by a quarter percentage point Thursday, as it predicted inflation in 2022 could hit the highest level in 14 years amid soaring oil and commodity prices, Yonhap News Agency reported.
The monetary policy board of the Bank of Korea (BOK) voted to increase the benchmark seven-day repo rate to 1.75 percent at a rate-setting meeting held early in the day, according to the central bank.
This marked the third rate hike this year after 0.25 percentage-point increases in both January and April.
Thursday's rate hike came as the country is grappling with high-rise inflation pushed up by soaring oil, energy and other major commodity prices amid the protracted Russia-Ukraine war that has exacerbated the global supply chain disruptions.
In a separate decision, the BoK revised upward its inflation outlook for this year to 4.5 percent from 3.1 percent projected three months earlier. The forecast, if proved, could be the fastest price growth since 2008, when prices grew 4.7 percent.
"The board sees it as warranted to conduct monetary policy with more emphasis on inflation for some time, as the Korean economy is expected to continue its recovery and inflation to run above the target level for a considerable time, despite underlying uncertainties in domestic and external conditions," the BoK said in a statement. (end)
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