Hotter than expected prices put South Korea on track for a July hike
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ASIA/PACIFIC: South Korea’s inflation pressures broadened and firmed in May. With growth holding up and inflation on a higher path, the Bank of Korea is poised to begin a new tightening cycle. We expect the BoK to raise rates by 25bp in July, October, and again in the first half
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4 itemsHotter than expected prices put South Korea on track for a July hike
Hotter than expected prices put South Korea on track for a July hike
Asia week ahead: Korea rate call, data from China and India
The desk anticipates a 25 basis point rate hike from the Bank of Korea (BoK), signaling the start of a tightening cycle in response to rising inflation and resilient economic growth. Per the full note from ing-think, South Korea's inflation has firmed, prompting the BoK to reassess its monetary policy stance. Meanwhile, Indian inflation is projected to tick up slightly in June amid pressures from core inflation, while mixed signals from China reveal ongoing economic complexities. Collectively, these developments form the basis for a cautious but bullish outlook on the Korean won against the backdrop of broader Asian FX trends.