Bank of Korea's Rate-Hike Cycle Could be Faster than Expected
Dow Jones08-05
0244 GMT - The Bank of Korea's rate-hike cycle could proceed faster than previously expected as South Korea's economic fundamentals strengthen, Morgan Stanley's Kathleen Oh says. The economist expects the BOK to raise its policy rate to 3.5% by 1Q 2027, earlier than her previous forecasts. Both tech and non-tech exports are likely to continue accelerating, while consumption is expected to recover rapidly on improving household income and fiscal support, Oh says. Demand-driven price pressure is likely to keep core inflation elevated, she adds. Morgan Stanley raises its 2026 growth forecast for the country to 3.4% from 2.8% and its 2027 forecast to 2.7% from 2.3%.
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