The South Korean won rose today against the euro and gained versus the US dollar before retreating as the nation’s central bank lifted its main interest rate to rein the inflation.
The Bank of Korea raised its Base Rate by 25 basis points to 3.25 percent today. The Bank was pretty optimistic regarding the nation’s economic growth in its statement:
For Korea, the Committee judges that, despite the temporary sluggishness of domestic demand, the economy has maintained its underlying upward trend on the strength of the sustained high growth of exports.
As for the inflation, the Bank wrote:
The Committee expects inflationary pressures to continue in the coming months, driven largely by increased demand from the economic upswing and by inflation expectations.
USD/KRW traded near its opening level of 1,081.2000 as of 11:51 GMT after falling to 1,078.0000. EUR/KRW dropped to 1,564.3500 from 1,568.9501.
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