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In a surprise move, South Korea's central bank on Thursday cut its key interest rate to a record low 1.25 percent.

The Bank of Korea lowered the policy rate by 0.25 percentage points, marking the first rate cut in 12 months.

There had been little hint of a cut, with the bank widely expected to maintain its wait-and-see mode amid what it has called minor signs of improvement in Asia's fourth-largest economy.

But mounting concerns over the negative impact on consumption from layoffs sparked by ongoing corporate restructuring, particularly in shipyards, apparently forced the bank's hand.

The cut also came after Federal Reserve chair Janet Yellen hinted at a more gradual rise in US key rate earlier this week, dampening expectations for a hike in the foreseeable future.


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Brian Schrauger

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Brian Schrauger is the Editor-in-Chief of the Jerusalem Journal. A registered journalist with Israel's Government Press Office, he is also an author, speaker and regular contributor to the Jerusalem Post. Book him to speak to your group. His email address is Follow him too on Facebook and Twitter

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