Bank of Korea board members saw more interest rate cuts necessary
The Bank of Korea kept its benchmark interest rate unchanged at 2.50 per cent at the meeting, but a majority of board members signalled another rate cut in the next three months and warned of "significant" economic uncertainty from US tariffs.
"Uncertainty surrounding the future growth trajectory remains significantly high, particularly due to trade negotiations with the United States," one member said, arguing the board should maintain an accommodative policy stance to support weak growth.
One member concurred by saying "it is time to consider an additional rate cut", while another member said "the need for base rate cuts still remains".
Board members cited developments in the country's trade talks with the US as a key factor for the future policy path, as South Korean officials scramble to try to clinch a deal that reduces tariffs.
South Korean Finance Minister Koo Yun-cheol said on Tuesday he would seek a mutually beneficial trade deal when he meets US Treasury Secretary Scott Bessent for talks this week, just days before an Aug 1 deadline expires to avoid punishing tariffs.
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