Business News
South Korea keeps base rate at 2.25 per cent
Sep 9, 2010, 5:19 GMT
Seoul - The South Korean central bank left the key interest rate at 2.25 per cent on Thursday, amid growing concerns about sovereign debt in Europe and a slowdown in the US and China, a news report said.
The rate has been at 2.25 per cent since July, when it was raised after being held at a record low of 2 per cent for 16 straight months in response to the economic downturn.
Analysts had expected the Bank of Korea to raise the rate as the global economy recovered, and as bank governor Kim Choong Soo earlier said that 2.25 per cent was still 'highly accommodative.'
But Thursday's statement, quoted by South Korean Yonhap News agency, said 'the possible economic slowdown in major economies and the eurozone debt crisis will act as downside risks to growth,' even as Asia's fourth-largest economy was benefiting from increased domestic consumption and exports.
The International Monetary Fund last week upgraded its 2010 growth outlook for the South Korean economy to 6.1 percent from 5.75 percent. The central bank has predicted a growth of 5.9 per cent.
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