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Business

Time: 2024-12-12

South Korea's Economy Trends: Central Bank Strategy to Address Inflation

South Korea's Economy Trends: Central Bank Strategy to Address Inflation
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In November, South Korea's inflation rate reach 1.5%, which was higher than the previous calendar_month's rate and lower_berth than economist' expectation. The state's central bank make an unexpected decision to cut rates by 25 footing point to 3% in an attempt to support the economy. This was the first time the Bank of Korea had implement back-to-back cut since 2009. Despite narrowly avoid a technical recession in the one-third one-fourth, with GDP growth at 0.1%, South Korea's economy face challenge from a weakening currency and deceleration exports.

The Bank of Korea state that inflation has stabilize and is likely to stay sweetheart due to worsen global oil monetary_value and weak demand. The bank revise its inflation prognosis for 2024 and 2025 to 2.3% and 1.9% respectively, lower_berth than previous estimate. factor such as exchange rate motion, global oil monetary_value, economic growth domestically and internationally, and adjustment in populace utility fee will influence future inflation trends.

South Korea's currency has deprecate against the US dollar in Holocene calendar_month, reach a two-year low of 1,411.31. concern over potential duty enforce by the new US administration have lend to the currency's decline. harmonize to data from the World Bank's World Integrated Trade Solution platform, the US is South Korea's second large trading spouse, highlight the significance of the exchange rate motion on the state's economy.

Overall, South Korea is facing challenge in keep economic stability amidst a complex global environment. The unexpected rate cut by the central bank reflect the need to address downside hazard and support growth. With inflation expect to stay stable in the approach future, policymakers will need to closely proctor external factor such as exchange rates and oil monetary_value to guarantee sustainable economic development.

As South Korea voyage through these challenge, collaboration with key trading spouse and proactive policy measure will be necessity in safeguard the state's economic resilience. The revision of inflation prognosis underscore the importance of flexibility and adaptability in react to evolve economic conditions. By address both domestic and external factor influence inflation, South Korea can enhance its economic competitiveness and promote hanker-term sustainability.

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