The Bank of Korea (BOK) kept its key interest rate unchanged at 3.5% for the 13th consecutive time on Thursday, citing persistent household debt and moderating inflation. The decision follows a series of rate hikes from April 2022 to Jan. 2023. The central bank also lowered its 2024 growth forecast to 2.4% from 2.5%, reflecting weaker domestic demand despite robust exports.

Household debt in South Korea continues to climb, with outstanding credit reaching a record $1.42 trillion (1,896.2 trillion won) in the second quarter of 2024. Inflation rose to 2.6% in July, remaining below 3% for the fourth month. The BOK’s rate freeze aligns with the U.S. Federal Reserve’s July 31 decision to hold rates steady, indicating cautious monetary policy amid uncertain economic conditions.