Morgan Stanley economist Kathleen Oh says the Bank of Korea is likely to hold
rates at its October meeting to assess the impact of prior hikes, though two
board members may vote to tighten further amid still-elevated core inflation and
market concern that price pressures could become entrenched. Oh warns higher
rates would further pressure low-income households, wage earners and small,
labor-intensive firms, but Korea’s recovery—led by services and
construction—means the economy can likely absorb additional tightening. Morgan
Stanley expects one rate rise in November and another in Q1 2027.
