SEOUL, Aug. 12 (UPI) -- The Bank of Korea kept its bank-to-bank lending rate unchanged at 2.25 percent Thursday, despite indications the U.S. economy had slowed.
Bank Gov. Kim Choong-soo said the South Korean economy "may have entered the expansionary phase," although expectations of a recovery in the United States had dimmed.
"The U.S. economy is recovering at a slower-than-expected pace, but it is not grave enough to change our views about the Korean economy," he said in a press conference, the Yonhap News Service reported.
A month ago, the BOK made a move to check rising prices by upping their key rate to 2.25 percent after 16 months at 2 percent. The move marked a change in strategy, as the bank began to back away from measures taken to provide liquidity in the financial system during the global recession.
The gross domestic product in South Korea hit 7.6 percent in the first half of the year. In comparison, the U.S. economy in the second quarter grew 2.4 percent, which is seen as too low to subtract from the 9.5 percent unemployment rate.
The U.S. economy is a major customer of South Korean businesses which, like Japan and China, are dependent on a strong export market.
Kim said "maintaining price stability will be a very important task down the road," a potential hint that the BOK could raise interest rates next month.
