Bank of Korea Flags More Rate Cuts to Come as Tariffs Hit Growth

The Bank of Korea flagged the likelihood of more interest rate cuts to come after trimming borrowing costs on Thursday and slashing this year’s growth forecast as Donald Trump’s tariffs and political turmoil weigh on the economy.

The central bank lowered its seven-day repurchase rate by a quarter percentage point to 2.5% on Thursday and almost halved its growth forecast for the current year to 0.8% from its projection in February. That move largely reflects the impact of the US trade tariffs rolled out since then, and while their legality is currently in dispute, South Korea’s trade-reliant economy is among those most at risk if they come into full effect.