The Bank of Korea held the base rate steady at 2.75 percent on Thursday, as the South Korean economy faces renewed pressure from heightened trade tensions driven by US President Donald Trump’s “reciprocal tariffs.”
The BOK’s decision came amid continued volatility in the Korean won, which has fluctuated since the US administration announced the imposition of reciprocal tariffs on all its trading partners.
On April 9, the Korean won fell to 1,487.6 per US dollar during daytime trading, marking its weakest level since March 2009.
While the won has seen a partial recovery in recent days, it opened Thursday’s trading session at 1,416 per dollar, as investors priced in hopes that the US may adopt a softer stance on tariff enforcement.
However, the currency’s inability to strengthen below the 1,400 won level continues to weigh on the local economy, which relies heavily on energy imports.
Experts project that the BOK may cut the base rate by 25 basis points at its next rate-setting meeting in May, after assessing the impact of the tariffs on the economy. The next meeting is scheduled for May 29.
