BOK holds interest rate steady as expected
One BOK board members sees door open for nearterm rate cut

SEOUL, Feb 22 Reuters South Korea39;s central bank on Thursday joined its peers in the U.S. and Australia in seeking to hose down investors39; aggressive rate cut expectations after keeping interest rates at a 15year high.

Most board members still see it as premature to discuss any interest rate cuts as inflation is above our target level and we need to check its slowdown path, governor Rhee Changyong said in a news conference in Seoul. The Bank of Korea BOK kept interest rates steady at 3.50, as expected by all 38 analysts polled by Reuters.

That echoes recent comments from Federal Reserve Chairman Jerome Powell, who has repeatedly said policymakers should be prudent in deciding when to make policies less restrictive and be confident inflation will continue falling.

The BOK39;s decision on Thursday to hold rates steady was a unanimous one.

However, Rhee on Thursday added one of the board39;s seven members said the door for a rate cut should remain open over the next threemonths.

That was enough to keep the chance of a rate cut on investors39; radar with South Korea39;s policysensitive threeyear treasury bond futures rising during the news conference.

I don39;t think that one board member39;s view signals an imminent rate cut but rather that the bank is slowly gearing up for a pivot towards interest rate cuts, said Kong Dongrak, a fixedincome analyst at…