South Korea’s central bank cut its key interest rate yesterday for the fifth time in just three months to help shore up the country’s sagging economy.
The Bank of Korea lowered the benchmark seven-day repurchase rate to a new record low of 2.5 percent from 3 percent at a regular policy meeting yesterday.
“Domestic economic activity is slackening at a rapid pace,” the bank’s monetary policy committee said in a statement. “The downside risk to economic growth is considered to have been heightened by the persistent financial market unrest including the credit crunch.”
The central bank has joined others worldwide in slashing rates to battle the global financial crisis. The Bank of England on Thursday cut rates to 1.5 percent — the lowest level in its 315-year history.
South Korea’s export-driven economy has been hit hard by declines in global consumer demand. Factory output plunged 14.1 percent in November from the same month the year before, government data show.
Exports fell 17.4 percent last month, following a drop of 18.3 percent in November.
The Bank of Korea said last month that the economy will probably manage growth of just 2 percent this year from an estimated 3.7 percent last year. South Korea, Asia’s fourth-largest economy, grew 5 percent in 2007.
Some economists, however, say South Korea could this year suffer its first contraction on an annual basis since 1997, when it was in the throes of the Asian economic crisis.
Yesterday’s cut marked the fifth time the Bank of Korea has slashed the key rate since Oct. 9. A full percentage point reduction last month was its biggest ever.
South Korea’s benchmark stock index fell 2.1 percent yesterday to close at 1,180.96. The won fell 0.7 percent against the US dollar to finish at 1,343.
South Korea’s rate still remains above those of some major central banks. The US Federal Reserve’s key rate is at a record low, in a range of zero to 0.25 percent. The Bank of Japan’s benchmark rate is at 0.1 percent.
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
A US Marine Corps regiment equipped with Naval Strike Missiles (NSM) is set to participate in the upcoming Balikatan 25 exercise in the Luzon Strait, marking the system’s first-ever deployment in the Philippines. US and Philippine officials have separately confirmed that the Navy Marine Expeditionary Ship Interdiction System (NMESIS) — the mobile launch platform for the Naval Strike Missile — would take part in the joint exercise. The missiles are being deployed to “a strategic first island chain chokepoint” in the waters between Taiwan proper and the Philippines, US-based Naval News reported. “The Luzon Strait and Bashi Channel represent a critical access
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College
RSS