Seoul: More than eight out of 10 bond traders expect the central bank to keep its policy rate steady this week amid housing market instability and increased volatility in the foreign exchange market, a survey showed Tuesday.
According to Yonhap News Agency, the survey conducted by the Korea Financial Investment Association last week revealed that 84 out of 100 bond traders from 53 local institutions projected that the Bank of Korea (BOK) would hold the key rate steady at its rate-setting meeting scheduled for Thursday.
The traders cited rising household debt, instability in the real estate market, and increasing volatility in the foreign exchange market as key reasons behind their expectations for a rate hold.
However, 16 percent of the surveyed traders expected the BOK to slash the interest rate, citing lingering concerns over an economic slowdown.
In July, the central bank held its key rate steady at 2.5 percent, adopting a cautious approach amid concerns about rapidly rising housing prices and uncertainties stemming from the United States' tariff policy.
The move followed a rate cut in May, when the BOK lowered the policy rate by 25 basis points to support economic growth. The BOK began the monetary easing cycle in October and has since cut interest rates by a cumulative 100 basis points.