The Bank of Korea\'s Monetary Policy Board on Wednesday held the base interest rate at 2.5 percent for a sixth consecutive meeting. It said inflation is maintaining a stable trend around the target level and growth is improving more than expected, while financial stability risks persist. The board forecast 2026 economic growth at 2.0 percent, above its 1.8 percent estimate presented in November, and projected consumer inflation at 2.2 percent and core inflation at 2.1 percent.

The Bank of Korea is expected to raise its 2026 real GDP growth forecast to 1.9 to 2.0 percent from 1.8 percent in revised projections due on Feb. 26, analysts said. They cite a strong semiconductor cycle, improving exports, recovering domestic demand and wealth effects from higher share prices. Views differ on the impact of a U.S. Supreme Court ruling voiding reciprocal tariffs and President Donald Trump’s warning of a new 10 percent tariff. Inflation is expected to stay around 2.1 percent.