Bank of Korea: Rate cut a matter of time – ANZ

Analysts at ANZ note that the Bank of Korea (BoK) kept its policy rate on hold at 1.75% today, as widely expected, but the decision was not unanimous, with one member voting for a rate cut.

Key Quotes

“While there was little else in either the BoK’s accompanying statement or the press briefing that suggest an imminent rate cut is on the cards, we note that the BoK doesn’t have a history of sending clear signals ahead of time.”

“Overall, we are of the view that the economic backdrop will eventually push the central bank into adopting a more accommodative policy stance.”

“We are maintaining our forecast for a 25bp rate cut in Q3, and a move as early as the BoK’s next meeting in July cannot be ruled out, especially if the economic data continue to disappoint.”