[Weekly Outlook] Focus on Two Consecutive Months of Base Rate Hikes... Possibility of Supplementary Budget Approval

Lee Chang-yong, the new Governor of the Bank of Korea, is meeting with reporters at the Bank of Korea briefing room on Sejong-daero, Jung-gu, Seoul, on the 25th. / Photo by Joint Press Corps

[Asia Economy Sejong=Reporter Dongwoo Lee] This week (May 23-27), attention is focused on whether the base interest rate will rise for the second consecutive month due to soaring inflation.

According to related ministries on the 22nd, the Bank of Korea's Monetary Policy Committee is scheduled to hold a monetary policy direction meeting on the 26th to decide the level of the base interest rate.

Last month, the Monetary Policy Committee raised the base interest rate by 0.25 percentage points from 1.25% to 1.50%, and attention is on whether it will take additional hikes in response to soaring inflation following last month.

The Bank of Korea will announce the 'Q1 Household Credit (provisional)' statistics on the 24th. As of the end of December last year, the household credit balance reached a record high of 1,862.1 trillion won.

Although the increase in household loans has slowed this year, interest is focused on whether the overall household credit size has decreased over the past three months.

On the 25th, Statistics Korea will release the March population trends. This includes statistics on births, deaths, marriages, and divorces.

In particular, the number of deaths in February was 29,189, an increase of 5,394 (22.7%) compared to the previous year. This is the highest for the same month since monthly statistics began in 1983.

The number of deaths generally follows an upward curve due to population aging, and the increase in direct and indirect elderly deaths caused by COVID-19 is also cited as a cause.

The second supplementary budget bill is also expected to pass this week. The National Assembly has scheduled a plenary session on the 26th, forming the first deadline for negotiations between the ruling and opposition parties.

This supplementary budget is the largest ever at 59 trillion won. It includes provisions such as paying loss compensation of 6 to 10 million won to small business owners affected by COVID-19 quarantine measures.