Bank of Korea Gov. Rhee Chang-yong on Feb. 26 bangs the gavel at a plenary session of the Monetary Policy Board at the bank's headquarters in Seoul's Jung-gu District. (Yonhap News)

By Kim Hyelin

The Monetary Policy Board of the Bank of Korea on Feb. 26 froze its base interest rate at 2.5%. This marks the sixth freeze, following July, August, October, and November of last year and January of this year.

The board called its measure appropriate since inflation remained stable near its target level and growth was better than expected, though acknowledging risks to financial stability persisting.

The economy has kept improving thanks to recovery in consumption and brisk exports. While construction investment will stay sluggish, the board said, the growth of exports and facility investment will exceed initial expectations thanks to a strong semiconductor market and robust global growth.

This led the bank to raise its economic growth forecast for this year to 2%, up from the projection of 1.8% in November last year.

The board said it will conduct monetary policy while closely monitoring financial stability conditions including household debt and foreign exchange volatility, as well as back the recovery of economic growth.

kimhyelin211@korea.kr