South Korea's central bank on Friday held its policy rate steady for November, extending its wait-and-see mode for the fifth consecutive month amid uncertainties following Donald Trump's unexpected win in the US presidential race.
In a widely expected move, the monetary policy board of the Bank of Korea voted to keep the key rate at 1.25 percent.
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BOK Gov. Lee Ju-yeol enters the conference room of the central bank's monetary policy board in Seoul on Nov. 11, 2016. (Yonhap) |
In June, the central bank sent the key rate to the record low level, citing a need to support Asia's fourth-largest economy.
South Korea's exports fell for the second straight month in October due mainly to sluggish shipments of cars and mobile devices.
Outbound shipments came to $41.9 billion last month, down 3.2 percent from $43.4 billion the same month last year, according to government data.
"The Board forecasts that the domestic economy will sustain its trend of modest growth going forward, in line with a recovery of the global economy, but in view of recent changes in domestic and external conditions judges the uncertainties surrounding the growth path to have increased further," the board said in a statement.
The decision by the BOK board is in line with a recent poll, in which 99 out of 100 bond market experts surveyed forecast the central bank to keep its key rate unchanged in November.
The freeze came amid concerns on South Korea's growing household debt and uncertainties on the US monetary policy following Trump's upset victory.
South Korea's household debt reached an all-time high of 1,257.3 trillion won ($1.07 trillion) as of the end of June due to record-low interest rates and strong demand for new apartments.
It's one of the highest household debt levels in the world compared with income levels. (Yonhap)
