Bank of Korea lifts rate to 3% after second straight hike
What's new: The central bank sharply raised its 2026 growth forecast to 3.3% as inflation stays above target and chip exports surge.
The Bank of Korea raised its benchmark seven-day repurchase rate by 25 basis points to 3% on Thursday, delivering a second straight increase as inflation remained above its 2% target and economic growth beat forecasts. The move follows a quarter-point hike in July, the first since January 2023. The central bank kept its inflation outlook at 2.7% for 2026 and 2.3% for 2027, while lifting its GDP forecasts to 3.3% this year from 2.6% and to 2.9% next year. South Korea's economy grew 3.7% in the second quarter from a year earlier, helped by strong semiconductor demand tied to the global AI build-out. The won strengthened after the decision, reaching 1,377.40 per US dollar.