BOK hikes rates for first time in 3-1/2 years, signals more

The Bank of Korea raised its seven-day repurchase rate by 25 basis points to 2.75%, the first hike in three-and-a-half years, aimed at stabilising the weakening won and curbing persistent inflation. The central bank signalled further tightening, with analysts expecting at least one more rate hike before year-end to take the policy rate to 3.00%. The move aligns South Korea with a broader regional tightening trend led by the Bank of Japan, Australia, New Zealand, Indonesia, and the Philippines.