Overview
- The Monetary Policy Board left the base rate at 2.5%, pausing after 100 basis points of cuts since late 2024.
- Five of six board members backed the hold, and five signaled keeping open the option of further reductions within three months, according to Gov. Rhee Chang-yong.
- The 2025 GDP forecast rose to 0.9% on stronger consumption from supplementary budgets and resilient semiconductor exports, with construction weakness still a drag.
- Inflation is projected around 2.0% this year, giving limited scope for easing while the bank monitors financial stability risks.
- Authorities cited rising Seoul home prices, elevated household debt, and a roughly 2 percentage‑point U.S. rate gap that could pressure the won, with the recent 15% U.S. tariff deal helping reduce trade uncertainty.