Thursday, 8 September 2011

South Korea Keeps Rates Unchanged, Won Down

The South Korean won fell today after the country's central bank decided to maintain unchanged the key interest rates, indicating that economic recovery is faltering.

The Bank of Korea has maintained its key base rate at 3.25 percent. The bank said in a statement:

Based on currently available information, the Committee considers that, while emerging market economies have shown favorable performances, the recoveries in major advanced economies including the US have exhibited signs of further weakening. Going forward, the Committee forecasts that the global economy will keep up its recovery albeit at a moderate pace; nevertheless, the Committee judges that the possibility has increased of such factors as the economic sluggishness in major countries, the sovereign debt problems in Europe, and international financial market unrest posing downside risks to the global economy.

USD/KRW climbed from 1,071.80 to 1,075.25 today as of 11:06 GMT. Earlier, it dropped to 1,068.60.

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