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# South Korea's Bank of Korea hikes base rate 25 bp to 3.00% in back-to-back increase
- URL: https://www.theglobalbanker.com/bank-of-korea-hikes-base-rate-300-back-to-back/
- Published: 2026-08-27T09:37:00.000Z
- Updated: 2026-10-02T00:51:20.000Z
- Description: The Bank of Korea raised its Base Rate by 25 basis points to 3.00%, delivering a second consecutive hike and citing mounting inflationary pressure.
- Author: TGB Editorial Team
- Tags: Central Banks, Asia-Pacific

The Bank of Korea raised its Base Rate by 25 basis points to 3.00% on Thursday, delivering the country's second consecutive rate hike and citing mounting inflationary pressure. The move takes the policy rate to its highest level since January 2025 and marks the first back-to-back increases from the central bank since early 2023.

The Monetary Policy Board's decision, announced in the Bank of Korea's release, lifts the benchmark from 2.75%. Six of the seven board members backed the increase, with Hwang Kun-il dissenting in favour of holding at 2.75%. The bank said it aimed to prevent inflationary pressures from becoming widespread through pre-emptive action, while paying attention to financial stability risks.

#### CONSECUTIVE HIKES SIGNAL RESOLVE

The back-to-back rate rises are the first from the central bank since early 2023, ending a prolonged period during which the Board had been either on hold or gradually easing policy. 

The move follows a 25 basis point increase in July, and the two hikes have together added 50 basis points to the base rate.

#### HIGHEST SINCE JANUARY 2025

At 3.00%, the Base Rate now stands at its highest level since January 2025\. Consumer prices rose 2.8% year on year in July, while core inflation reached 2.6%, its highest since December 2023.

The central bank cited mounting inflationary pressure as a driver of the decision. Officials pointed to elevated oil prices, Middle East tensions and a stronger-than-expected economic recovery. The bank raised its 2026 growth forecast to 3.3% from 2.6% and projected inflation of 2.7% for 2026 and 2.3% for 2027.

The Bank of Korea's next rate decision is scheduled for 22 October 2026.