SEOUL :Most of the Bank of Korea’s board members assessed headwinds to South Korea’s economy were growing faster than expected, a factor that would warrant more interest rate cuts, minutes from last month’s meeting showed on Wednesday.
“With economic growth this year expected to fall short of previous forecasts due to the economic slowdown, the need for preemptive interest rate cuts is growing,” one of the seven board members said, according to the minutes from the bank’s April 17 rate review.
The BOK’s seven-member board on April 17 held the benchmark interest rate at 2.75 per cent as expected at its monetary policy review and signaled it would cut rates in May to cope with “significant” risks to the economy from U.S. President Donald Trump’s sweeping tariff policy.
A majority of economists surveyed by Reuters expect the BOK to lower the benchmark interest rate to 2.25 per cent by the end of the third quarter of this year as shifting U.S. tariff policy fuels fears of a global recession and threatens to sharply curtail exports out of Asia’s fourth-largest economy.
The BOK next reviews policy interest rates on May 29.
