S.Korea keeps interest rate at 2.0 percent

SOUTH Korea’s central bank on Tuesday kept its benchmark interest rate unchanged at a record-equalling low of 2.0 percent for the fourth straight month.

The decision was widely expected as the Bank of Korea is still gauging the impact of previous rate reductions.

It cut the base rate twice last year — in August and October — by 0.25 percentage points.

The last time the rate was down at 2.0 percent was 2009-10 when Asia’s fourth-largest economy was seeking to recover from the global financial crisis.

South Korea’s economy registered its slowest growth for more than two years in the fourth quarter, expanding 0.4 percent in the October-December period from the previous quarter.

And last month the BOK slashed its economic growth forecast for 2015 to 3.4 percent, down from an earlier forecast of 3.9 percent.

Some analysts predict a fresh 25 basis points cut in April or May after the first quarter economic performance is confirmed.