South Korea - Lending Rate

For South Korea, the monetary policy framework targets inflation over a mid-term horizon, as measured by CPI. The "Base Rate" is the reference policy rate applied in transactions between the Bank of Korea and financial institutions.

The Base Rate is the fixed bid rate on sales by the Bank of Korea of seven-day RPs and the minimum bid rate on purchases of same. It determines the rate on liquidity adjustment deposits and loans. It has a prompt impact on the call rate (i.e., the overnight interbank lending rate) and delayed impacts on short- and long-term market rates and deposit and loan rates.

The Base Rate is decided eight times a year by the Monetary Policy Board of the Bank of Korea.

• Measurement: Percent per annum
• Adjustment: Not seasonally adjusted (NSA)
• Native frequencies and start dates:
  • Daily from 6 May 1999
  • Weekly from May 1999

Overnight interbank call rates are based on intermediated overnight transactions excluding transactions between Investment Trust Management & Securities companies and their subsidiaries (Investment Trust Management Companies). Lower frequencies are computed as weighted average rates by trading volume.

Repurchase agreement: RP or repo.

Bank of Korea hold a monthly monetary policy decision meeting, if the rate is changed data will be updated.

Further reading

At the source:

• Monetary policy framework
• Bank of Korea Base Rate
• http://eng.bok.or.kr/broadcast.action?menuNaviId=1897 (dead link)

• Sep 2005 - Initial version.
• 6 Jul 2023, Phillip Thorne - Description, Further reading.