Bank of Korea hikes rates for first time in 3-1/2 years

SEOUL, (UrduPoint / Pakistan Point News / WAM - 16th Jul, 2026) The Republic of Korea's central bank delivered a quarter-percentage-point interest rate hike for the first time in three-and-a-half years on Thursday to tackle high inflation.

The Bank of Korea (BOK) convened a Monetary Policy board meeting and lifted the benchmark rate from 2.5 percent to 2.75 percent, Yonhap news Agency reported.

This marked the first rate increase since January 2023, when the central bank hiked the rate by 0.25 percentage point to 3.5 percent as part of its policy normalisation to jumpstart the pandemic-hit economy.

The BOK began monetary easing in October 2024 and has cut the benchmark interest rate by a cumulative 100 basis points from 3.5 percent to support economic growth. It had kept the rate unchanged since July 2025.