Rate Expected to Hold Steady
The Bank of Korea is expected to maintain the overnight call rate, the rate at which banks lend funds to each other, at 5 percent when its Monetary Policy Committee meets Tuesday morning.An official from the bank hinted that inflationary concerns preclude a cut in the key rate. "The exchange rate has fallen below 1,300 won, but prices rose by 5.3 percent in April, the highest in 29 months, so it's too early to say the economy is steady," he said.
But there is some speculation that a rate cut still might take place since Chon Chol-hwan, the central bank governor, has said monetary policy would be used flexibly to keep the economy from slowing.
with the Korea JoongAng Daily
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