FILE PHOTO: South Korea's new central bank governor Rhee Chang-yong speaks during his inauguration ceremony in Seoul, South Korea April 21, 2022. SeongJoon Cho/Pool via REUTERS/File PhotoSEOUL : South Korea's central bank governor said on Tuesday the pace of consumer inflation is likely to continue to slow, feeding expectations the Bank of Korea will start cutting interest rates towards the end of this year.
Inflationary pressure from domestic demand is likely to stay contained, while exports growth is expected to take the driver's seat in the economy seen growing 2.5 per cent this year, he added. The BOK extended its interest rate pause for an 11th straight meeting in May, keeping it restrictive after raising rates by a cumulative 300 basis points to 3.50 per cent since mid-2021.
The BOK also noted that although inflation is headed towards its target rate of 2 per cent, the cost of living in Asia's fourth largest economy remains elevated compared to other major countries.