Bank of Korea forecast to cut rates amid global currency war

각국 환율전쟁 격화••• 한국도 기준금리 인하 전망 Central banks around the world are devaluing their currencies to keep themselves competitive. Korea has been no exception,... cutting its rate to a record-low one-and-a-half percent over the past year or so. And analysts say further cuts could be on the horizon soon. Park Se-young has the details. The "global currency war" is intensifying, with central banks in various countries following China's movement to weaken their local currencies. According to Bloomberg, the People's Bank of China cut the yuan midpoint by 0.22 percent in January, …after having devalued its local currency by nearly five-percent in just four days last August. The PBOC did on Thursday raise the yuan fixing by zero-point-1-6 percent to fight off bearish sentiments. The Bank of Japan recently adopted a negative interest rate strategy, which will in effect drive down the yen. The European Central Bank, having rolled out a negative rate policy in 2014, is likely to cut its interest rates again in March. Global investment banks are extending their forecasts of the Bank of Korea lowering its benchmark interest rate within the first three months of the year. Speculation of a rate cut at this month's policy meeting rose sharply after the BOJ's negative interest rate announcement,. … following concerns of the Korean won appreciating against the yen and hurting exporters. Korea's exports shrank 18-point-five percent on-year in January, …the biggest drop since 2009. But the country's heavy household debt and the potential of a faster outflow of foreign capital are factors that could prevent the BOK from lowering rates further. Park Se-young, Arirang News. Visit ‘Arirang News’ Official Pages Facebook(NEWS): http://www.facebook.com/newsarirang Homepage: http://www.arirang.com Facebook: http://www.facebook.com/arirangtv Twitter: http://twitter.com/arirangworld Instagram: http://instagram.com/arirangworld

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