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Bank of Korea Rate Hike — Is it Chasing Its Own Economy?
Published 1 month, 1 week ago
Description
The Bank of Korea has raised its policy rate to 2.75% — its first hike in three and a half years — as inflation hits a two-and-a-half-year high of 3.2%. But the real story is what's driving prices: Governor Shin says Korea's trillion-dollar AI and chip investment boom is no longer just fuelling growth, it's fuelling inflation. Ho Woei Chen, Economist and Senior Vice President at UOB Group, tells us why UOB now expects rates to hit 3.25% by January, whether a quarter-point hike can cool Seoul's runaway housing market, and what happens when an energy shock and a demand shock collide.
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