South Korea’s Monetary Policy Board on Thursday held the benchmark interest rate at 2.75%, citing persistent downside risks to economic growth and external uncertainties, despite stable inflation. The decision marks the sixth consecutive hold since the board began pausing its tightening cycle, and follows signs of unexpectedly weak economic performance in the first quarter of 2025.

The Bank of Korea (BOK) pointed to deteriorating global trade conditions, growing volatility in foreign exchange markets and the potential impact of U.S. tariffs as key factors behind the rate hold. While consumer price growth remained stable in March at 2.1% and core inflation at 1.9%, the central bank warned that the path ahead remains uncertain due to unresolved tariff negotiations, fluctuating energy prices and lingering household debt concerns. The BOK will reassess the outlook in its May economic forecast.