BoK goes back to outsized rate hikes

Delicate position: Rhee addresses the media after the central bank’s monetary policy meeting in Seoul. It’s his belief that inflation will remain high, substantially above the target level, although domestic economic activity has slowed. — Bloomberg

SEOUL: The Bank of Korea’s (BoK) return to outsized interest rate increases comes with a warning of slower growth as it sought to shore up a currency that has been driven to crisis-era lows by the US Federal Reserve’s (Fed) aggressive policy tightening.

The South Korean central bank raised its seven-day repurchase rate by a half-percentage point to a 10-year high of 3% yesterday, as expected by 16 of 19 economists surveyed by Bloomberg. The remaining three had forecast a quarter-point move.