South Korea’s central bank on Thursday left its benchmark interest rate unchanged, citing easing inflation pressures, an improving growth outlook and persistent financial stability risks, particularly related to the exchange rate. The Bank of Korea’s (BOK) Monetary Policy Board held the base rate at 2.5%, extending its policy pause for a fifth consecutive meeting. The decision was unanimous, though one board member argued for keeping open the possibility of a rate cut within the next three months, Governor Rhee Chang-yong said.

The BOK said inflation was expected to gradually slow toward its target but warned that the elevated