The Bank of Korea (BOK) is under mounting pressure to cut its benchmark interest rate, which stands at the highest level in more than 15 years and increases the burden of repayment on financially vulnerable borrowers.
According to the ruling People Power Party (PPP), Friday, BOK Deputy Gov. Ryoo Sang-dai and other senior financial officials will join a party meeting scheduled next Thursday to discuss ways to stabilize public livelihood.
The party explained it accordingly wants to help the government in spurring economic growth.
The meeting comes as the BOK has been stressing independence in rate decision, whereas government and party officials have been calling for a need to lower the BOK’s policy rate.
Sung Tae-yoon, the presidential chief of staff for policy, said that conditions are ripening for rate cuts.
Also, PPP leader Hwang Woo-yea pointed out that central banks of Canada, Sweden, Switzerland and the European Union have 커뮤니티 shifted to rate cuts after global montary tightening and that the BOK should take corresponding steps.
The BOK has been keeping the rate steady at 3.5 percent since January 2023 after aggressively carrying out monetary tightening campaign from April 2022 to bring down post-pandemic inflation driven by expansionary fiscal policy.
The BOK’s rate accordingly stands at the highest since December 2008.
And with easing inflation, the BOK is now asked to join again other central banks that are lowering their respective policy rate.