South Korea raises key interest rate

SEOUL, June 8 (UPI) -- The Bank of Korea raised its key short-term interest rate Thurday by a quarter of a percent to 4.25 percent in a bid to preempt inflation.

The action, which was expected, nevertheless sent the Kospi stock index down sharply, the Korea Times reported.

The bank's governor, Lee Seong-tae, hinted at another rate hike to ensure that inflation does not get a foothold in the economy.