[Bank of Korea Expected to Raise Interest Rates This Week for the First Time in Over Three Years] Odaily Planet Daily News – Economists predict that the Bank of Korea will implement its first interest rate hike in more than three years on Thursday, with another hike expected before the end of the year. South Korea's inflation rate rose to 3.2% in June, a two-and-a-half-year high, marking the fourth consecutive month above the Bank of Korea's 2% target. Inflation is expected to average around 3% in the second half of this year, paving the way for the start of a tightening cycle. Strong economic growth, rising housing prices, and persistently high household debt provide policymakers with room to tighten monetary policy. South Korea's economy grew at its fastest pace in nearly six years in the first quarter. Bank of Korea Governor Rhee Chang-yong stated that, given the surge in oil prices triggered by the Middle East conflict, inflation is expected to remain above the central bank's target for a considerable period, making a rate hike necessary. In a survey conducted from July 7 to 13, 36 out of 37 economists predicted that the Bank of Korea would raise its benchmark interest rate to 2.75% on July 16. Most of the surveyed economists (28 out of 31) expect another rate hike by the end of the fourth quarter, bringing the policy rate to 3.00%. One economist predicted the benchmark rate would reach 3.25%, while the remaining two forecast it would stay at 2.75%. The median forecast indicates that the Bank of Korea will raise the benchmark rate to 3.25% in the first quarter of 2027 and maintain that level at least until the end of next year, which is 25 basis points higher than the forecast in the May survey. (Jin10)