S.Korea central bank cuts rates to record low as pandemic hits economy

South Korea's central bank on Thursday cut its benchmark interest rate by 25 basis points in a bid to cushion the economic shock of the coronavirus pandemic.

The interest rate was lowered from 0.75 percent to 0.50 percent, the lowest since the bank adopted the current policy system in 1999.

This is the second relief measure the Bank of Korea (BOK) has taken this year. In March, it announced an emergency 50-basis-point-cut in the benchmark interest rate and pledged unlimited liquidity through June via repurchase agreements.

The bank downgraded its 2020 economic projection to a 0.2-percent decline, from its February forecast for 2.1 percent growth. The contraction would be the biggest since the 1998 Asian financial crisis. The BOK also sees inflation for this year at 0.3 percent, down from 1.0 percent seen earlier.

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