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Nomura Sees High Probability of Rate Hike at August BOK Meeting
Finance · Major Banks · yonhap_finance · 2026-08-26
Nomura Securities predicts a high likelihood of a 25bp rate hike by the Bank of Korea in August, citing strong economic growth and a heated housing market.
What Happened
Rate Hike Outlook: Nomura Securities forecasts a high probability that the Bank of Korea (BOK) will raise the base interest rate by 25 basis points at its upcoming meeting on the 27th. This analysis contradicts market expectations for a potential rate freeze, pointing toward a hawkish stance.
Key Drivers: Economist Park Jeong-woo cites stronger-than-expected economic growth and inflation data as primary drivers for the rate hike pressure. Furthermore, the overheating of the housing market, evidenced by a sharp rise in Seoul apartment prices, is reinforcing the central bank's need for monetary tightening.
Monetary Policy Stance: Nomura suggests that the BOK is unlikely to pivot to a dovish stance due to concerns over demand-side inflation. Consequently, the firm anticipates a high likelihood of consecutive rate hikes throughout the third and fourth quarters.
Terminal Rate: Maintaining its previous forecast, Nomura expects a total of 75 basis points in hikes—starting in August and continuing through October and February of next year—bringing the terminal base rate to 3.50%.