Bank of Korea Chief Warns of Stronger Inflation on Mideast Conflict
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Bank of Korea Governor Rhee Chang-yong warned that the Middle East conflict is adding pressure on inflation and posing risks to growth in South Korea. The central bank now expects inflation to exceed its previous estimate of 2.2% in 2026, and growth is expected to fall short of its forecast of 2.0% this year.
The Bank of Korea has kept interest rates unchanged for the seventh straight meeting. Governor Rhee Chang-yong cited the Middle East conflict as a factor adding upside pressure on inflation and downside risks to growth. The central bank expects inflation to exceed its previous estimate of 2.2% in 2026. Growth is expected to fall short of its forecast of 2.0% this year. The bank will revise its growth and inflation outlooks in May under a new chief. The current governor's term ends on April 20.
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