The Korea Development Institute (KDI) – a South Korean state think tank, said in a report on Wednesday that the Bank of Korea (BOK) needed to cut its benchmark interest rates to near zero to boost economy affected by the Coronavirus pandemic.
Key points to remember
“There is a need to lower the benchmark interest rate to almost zero percent.”
“Unconventional political tools, such as the direct purchase of treasury bonds, must be actively deployed, as rate cuts are unlikely to be enough to support the economic recovery and stimulate inflation.”
The South Korean central bank announced a 50 basis point cut in March, bringing its key rate to a record low of 0.75%. The BOK left the doors open for further rate cuts, with the May 28 political meeting now the center of attention.
On the above report, the Korean low for the Korean won (KRW) refresh session against the US dollar, with the USD / KRW peaking at 1,228.50.
At press time, the cross added 0.15% to trade at 1,226.90.