Korea Business News Agency - NSP NEWS AGENCY.

(Seoul=NSP NEWS AGENCY) = On the 28th, the Bank of Korea announced in a statement on its “monetary policy direction” that “the Bank of Korea has decided to operate monetary policy by lowering the base rate from the current level of 3.25% to 3.0%.” The Bank of Korea explained that “although exchange rate volatility has expanded, downward pressure on growth has increased amid the continued stabilization of the inflation rate and the slowdown in household debt.”

The so-called “Trump shock” was a major factor behind the decision. “Going forward, the domestic economy is expected to continue its moderate recovery in consumption, but export growth is expected to be lower than initially expected due to intensifying competition in key industries and rising protectionism,” the BOK said, adding that it also lowered its growth forecast.

“There is an expectation that the semiconductor industry will remain upcycled until the first half of next year, but differentiation is occurring by item,” said the head of the BOK's Economics and Statistics Department on July 7. ”In particular, general-purpose semiconductors are expected to be sluggish due to China’s growing market share and aggressive export growth.”

He continued, “With former US President Trump’s re-election, major changes in US economic policy, especially in trade, are expected,” and explained, “The general analysis is that the pressure on China and the strengthening of protectionism that he promised will have a greater negative impact on our export conditions.”

As a result, the BOK lowered its growth forecasts for this year and next year to 2.2% from 2.4% and 1.9% from 2.1%, respectively.

By Soon-ki Lee(s8789@nspna.com) and Soo-in Kang(sink606@nspna.com)

ⓒNSP News Agency·NSP TV. All rights reserved. Prohibits using to train AI models.