The South Korean central bank is widely expected to lower its policy rate by 0.25 percentage point next week in an effort to prop up the economy, a poll showed Friday.
According to a survey conducted by Yonhap Infomax, the financial news arm of Yonhap News Agency, 20 out of 21 local analysts and experts polled predicted the Bank of Korea will cut its base rate to 2.75 percent from the current 3 percent at its next rate-setting meeting slated for Tuesday.
In January, the BOK kept its benchmark interest rate frozen in the wake of the weak local currency amid political chaos and uncertainties stemming from US President Donald Trump's new administration.
The on-hold decision came on the heels of two rate cuts in the October and November meetings.
"The country is facing growing downside risks centering on weak domestic demand, while the won's further weakness seems limited, which would lead the BOK to lower the policy rate by 25 basis points," said Kim Seon-tae, an expert from KB Kookmin Bank.
Nineteen out of the 21 analysts polled anticipated the key rate to be lowered to 2.5 percent in the first half of this year.
The central bank is scheduled to present an adjusted growth forecast Tuesday. BOK Gov. Rhee Chang-yong has hinted at slashing the outlook to around 1.6 percent from its previous forecast of a 1.9 percent expansion.
South Korea's potential growth rate is at 2 percent, and this year may mark the first time ever that the country's yearly growth rate falls below the level. (Yonhap)
