South Korea's central bank raised interest rates for the first time in three and a half years on Thursday, July 16 — and made clear the move was only the beginning. The Bank of Korea's Monetary Policy Board unanimously lifted the seven-day repurchase rate by 25 basis points to 2.75 percent, ending a 14-month pause and opening what Governor Shin Hyun-song explicitly called a tightening cycle. The decision carried an economic irony that distinguishes it from every prior BOK rate hike: the inflation forcing the bank's hand was not imported from a stagnant economy struggling to grow. It was generated, in significant part, by the most spectacular export boom South Korea has ever recorded — one built on the same high-bandwidth memory chips that now power virtually every large-scale artificial intelligence system on earth.
