South Korea’s central bank cut interest rates. It lowered its growth forecast on Tuesday to support the economy amid US tariff concerns and the impact of last year’s martial law declaration by President Yoon Suk Yeol.

A Bank of Korea official told AFP that GDP growth in 2025 is now projected at 1.5%, down from 1.9%, while the benchmark interest rate has been reduced from 3.00% to 2.75%.

The country’s economic growth slowed in late 2024 as Yoon’s martial law move weakened consumer confidence and domestic demand.

Meanwhile, concerns are growing over US President Donald Trump’s trade policies, including 25% tariffs on steel and aluminium imports, which impact South Korea, the fourth-largest steel exporter to the US last year.

Trump has warned of potential 25% or higher tariffs on automobiles, semiconductors, and pharmaceuticals, threatening South Korea’s chipmaking giants, Samsung and SK Hynix.

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