S.Korea holds rates steady

S.Korea holds rates steady

SEOUL: South Korea's central bank on Thursday kept its key interest rate target for October steady for a third consecutive month in an effort to support exports, setting aside for the moment widespread concerns over soaring property prices.

The Bank of Korea (BoK) held the key overnight interbank rate unchanged at 3.75 percent, citing growing inflationary pressure and the won's rise against the U.S. dollar.

"We've decided to hold steady call rates this month as a rate hike to curb rising real estate prices, as demanded by the public, will make the ongoing economic slump worse," BoK governor Park Seung said.

He said a rate hike would put the economy in a more difficult situation and accelerate the won's appreciation, which makes South Korean products more expensive abroad.

"A rate hike could worsen the country's unemployment problem and lead to the the won's further rise against the dollar," Park said.

The Korean currency has jumped nine percent against the dollar since hitting a 2003 low in early April. -- AFP