South Korea's central bank raises interest rates

The South Korean Central Bank returned to its usual pace of tightening on Thursday, raising the interest rate by a quarter point, while balancing the stronger-than-expected disinflation needs with concerns over economic growth.

The Central Bank increased the seven-day repo rate by 25 basis points to 2.5 percent. This was also the expectation of economists participating in the Bloomberg survey.

Bank of Korea also raised its current year inflation forecast to 5.2 percent from the previous 4.5 percent outlook, making its highest forecast since 1998. The bank lowered its growth forecast for the year.