SEOUL: South Korea's central bank Thursday kept its key interest rate unchanged at 3.25 percent for a sixth straight month, as it faced a dilemma over lingering inflation and a global economic slowdown.
Analysts said the freeze underscored a policy dilemma as growth momentum was weakening while inflation persists. The inflation rate crept up above the central Bank of Korea's target band of 2%-4% again to 4.2% in November.
Growth in Asia's fourth-largest economy slowed for a second consecutive quarter in the July-September period to 0.8 percent on a quarter-on-quarter basis. From a year earlier, the economy grew 3.5 percent.
"A rate cut is likely to come in the first half of next year when inflation expectations may stabilise," Kim Dong-Hwan, a fixed-income analyst at Hi Investment & Securities, told Yonhap news agency.
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