South Korea: BoK expected to raise rates to 2.00% this year – UOB

In opinion of Economist at UOB Group Lee Sue Ann, the Bank of Korea (BoK) could lift the policy rate to 2.00% by end of 2022.

Key Quotes

“Given our expectation that the headline inflation will stay above 4% through 2Q22-3Q22, we have raised our average full-year 2022 forecast to 3.9% from 3.3% previously (2021: 2.5%).”

“We now see a further 50bps rate hike by the BOK this year, with 25bps each in May/Jul and Aug/Oct. This will bring the benchmark rate to 2.00% by end-2022.”