The Bank of Korea held its benchmark interest rate at 2.5%, extending a streak of inaction that now spans seven consecutive meetings. The decision was unanimous, with all seven board members voting to keep rates where they are.
Why the BOK is standing pat
The last time South Korea’s central bank actually moved was a 25 basis point cut back in May 2025. Since then, it’s been seven meetings of the same result.
The core tension is inflation. Headline consumer prices rose 2.2% in March 2026, overshooting the BOK’s 2% target. Geopolitical friction in the Middle East has pushed oil prices higher, adding upward pressure on consumer costs. South Korea imports virtually all of its crude oil, so any sustained spike in global energy markets hits Korean households and businesses faster than it does most developed economies.
What the economists are saying
