The central bank kept its benchmark seven-day repurchase rate at 5 percent at a monthly policy meeting, the bank said in a statement. Ten economists surveyed by Dow Jones Newswires had all forecast the central bank would keep the rate on hold.
The new benchmark, established last month, applies to transactions between the central bank and financial institutions, such as repurchase agreements. The previous benchmark had been left at 5 percent for six straight months after being raised to that level in August last year.
The central bank's Monetary Policy Committee has been focusing on the risks of both slower growth and inflation, although concerns about rising prices have been increasing.
South Korea's consumer price index was up 3.9 percent in March from the same month last year, staying above the central bank's inflation-targeting range of 2.5 percent to 3.5 percent for a fourth consecutive month.
Still, an escalation in risks to growth due to the softening pace of global economic expansion and still-troubled credit markets have led many economists to expect a rate cut as early as the current second quarter of this year.
On Tuesday, President Lee Myung-bak fueled expectations that the central bank might lower its key rate in the near term -- complementing the government's pro-growth policies -- by indicating that he is now more concerned about the economic slowdown than inflation.
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