South Korea's Bank of Korea (BOK) decided to keep the key interest rate unchanged at 3.5% on Thursday ending the cycle of 10-month long hikes, while the country's economic growth is expected to slow further as a result of global factors. According to the central bank, the gross domestic product (GDP) has been revised down and is projected to come in at 1.6% this year.
"Domestic economic growth is expected to improve gradually from the second half of this year with a recovery in the Chinese economy and in the IT industry," the bank's Monetary Policy Board explained.
With consumer prices in the country registered at 5.2% in January, which is marginally higher than December's figure, the central bank cautioned that inflation in South Korea will remain above the target level throughout the year. "Uncertainties surrounding the policy decision are high," policymakers stressed.