Bank of Korea Hawkish Pivot Sets Stage for July Lift-Off

The Bank of Korea held rates at 2.50% but pivoted hawkishly, signaling a likely 25bp hike in July 2026 due to upgraded growth and inflation outlooks.

Key Takeaways

• 1.The Bank of Korea maintained its policy rate at 2.50% but signaled a definitive hawkish pivot, with two members dissenting in favor of an immediate hike.
• 2.ANZ expects a 25bp rate hike in July 2026, targeting a year-end policy rate of 3.0%.
• 3.Significant upward revisions to GDP and inflation forecasts indicate more durable price pressures and a lasting semiconductor-led growth cycle.

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