BNP Paribas Executive Views Market as Excessively Pricing 4-5 Korea Rate Hikes by July 29

According to BNP Paribas Seoul branch head Seo Eun-jong in an interview with Yonhapinfomax today (July 29), financial markets are excessively pricing in interest rate increases from the Bank of Korea. Seo stated that short-term interest rate swap (IRS) markets are factoring in four to five rate hikes, which he views as getting "ahead of the curve." He forecasts the central bank's final benchmark rate will settle at 3.25%, with a possibility it could reach 3.50% but maintaining 3.25% as his base case. Seo expects the Bank of Korea and U.S. Federal Reserve will adjust policy flexibly based on incoming economic data, with the upcoming August decision being "data-dependent."
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