South Korea is the first developed country since the start of the pandemic to raise the base rate

South Korea raised its benchmark rate by 25 basis points from 0.5% to 0.75%. About it reported The central bank of the country.

The Korean authorities took such a step because of the growing inflation. Thus, the republic became the first Asian economy and the first developed country in the world, which, since the beginning of the pandemic, decided to fight the rise in consumer prices by raising the base rate.

“The global economy continues to recover as mass vaccinations advance and restrictions eased in some of the largest countries … Inflation in the consumer price sector is quite high – in the region of 2% – due to rising prices for petroleum products, agricultural products, food and services … The Board of Governors will continue to pursue monetary policy to support the economic recovery and stabilize consumer prices at the target level in the medium term, ”the Korean Central Bank said in a statement.

Earlier it became known that the United States may tighten monetary policy due to high inflation rates. At the July meeting of the Federal Open Market Committee, the Fed discussed the possibility of reducing the asset buyback programs by the end of this year. This can lead to an increase in rates on the national market and provoke an outflow of funds from the markets of developing countries.