South Korea Raises Interest Rates Against Overheating Economy
South Korea has raised interest rates to prevent the economy from overheating. It is the first time in nearly three years that the Bank of Korea has raised interest rates.
It is also the first major central bank in Asia to tighten monetary policy since the corona crisis.
South Korea is Asia’s fourth-largest economy and is showing a strong economic recovery from the crisis.
Interest rates are now moving from a record low of 0.5 percent to 0.75 percent. The country is dealing with rising household debt and sharp rises in house prices. This should be curbed by raising interest rates.
At a news conference, the central bank does not rule out further rate hikes but will not rush to do so, Governor Lee Ju-yeol said at a news conference.