South Korea Keeps Interest Rates Unchanged, Won Jumps

The South Korean won jumped today to the highest level in 5 months after South Korea’s central bank refrained from raising the interest rates.

The Bank of Korea left its seven-day repurchase rate unchanged at 2.25 percent for the third month today, after increasing it from the record low 2 percent in July. South Korea’s officials voiced the concern about the volatility of the interest rates across the world, which may harm the economic recovery. The central bank said it’d try to keep the prices in the country stable, the nation’s economy would continue to expand on the export.

The question of the consumer prices is important for South Korea as the prices surged 3.6 percent in September from the previous year. Yoon Jeung Hyun, South Korea’s Minister of Strategy and Finance, said that the policy makers should fight the inflation, which reached in September the highest level in 18 month. The Bank of Korea’s Governor said that the bank may be unable to fight the inflation using only the interest rates.

USD/KRW dropped from 1,119.60 to 1,109.80 as of 17:33 GMT today after it jumped to the intraday high of 1,131.00. EUR/KRW went down from 1,562.65 to 1,558.60, following the rise to 1,593.05.

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