Episode Description:
Korea's policy rate hasn't moved in over a year — so why did mortgage rates just jump half a point?
The Bank of Korea has held its base rate at 2.5 percent since May 2025, yet new mortgage rates rose to 4.36 percent and unsecured loan rates to 5.72 percent, each up about 0.5 points. Large corporations saw almost no change, exposing how lending caps concentrate the burden on households and small businesses. Household loans at the five major banks have already exceeded this year's growth cap by more than 1 trillion won, about 710 million dollars, pushing banks to raise rates. Meanwhile, low-cost demand deposits fell below 30 percent of bank funding for the first time in five years.
Sources:
* Household Loan Rates Rise Another 0.5 Points on Global Tightening and Lending Rules — Seoul Economic Daily, August 10, 2026
* Demand Deposit Share at Five Major Banks Breaks Below 30 Percent, Lowest in Five Years — Seoul Economic Daily, August 10, 2026
About AI PRISM:
AI PRISM is Seoul Economic Daily's WAN-IFRA award-winning newsroom AI series, delivering Korean economic news adapted for global audiences. Episodes are produced with AI assistance and reviewed by a human editor.
Tags:
#Korea #KoreanEconomy #BankOfKorea #InterestRates #Mortgage #HouseholdDebt #Banking #KOSPI #AIPRISM #SeoulEconomicDaily #WANIFRA
