world-economy

Bank of Korea Signals Rate Hikes Ahead Despite Cooling Inflation

South Korea's central bank indicated it may pursue additional interest-rate increases despite recent moderation in consumer price growth, according to minutes from July's policy meeting. While inflation dropped below 3% last month, easing some immediate pressure on policymakers, officials flagged persistent upside risks tied to stronger economic expansion. The Bank of Korea saw stronger growth as a threat to keeping inflation elevated and preventing it from falling to target levels. Financial stability considerations also weighed on the committee's deliberations, with members viewing higher borrowing costs as necessary insurance against building imbalances. The decision comes as regional policymakers worldwide grapple with determining the appropriate pace of monetary tightening. India's central bank, by contrast, is holding course as officials assess energy-cost pressures before potentially raising rates.