ANZ: South Korea July Inflation Data May Support August Rate Hike

According to Jin10, ANZ economist Krystal Tan said South Korea's July inflation expectation data, due next week, and consumer price data, due in early August, may be key to whether the Bank of Korea raises rates again in August. Tan said that if the data show stronger pass-through effects and rising inflation expectations, the case for an August rate hike will strengthen. She added that the August decision still appears to be a difficult call, but stronger-than-expected second-quarter GDP growth has increased the probability of consecutive rate hikes. Tan said attention is now shifting to whether price pressures will become more persistent and broad-based.