Korean interest rates may stay high

Bank of Korea Governor Lee Seong-Tae said inflation will probably remain elevated for a significant period, an indication he may keep interest rates at an eight-year high this year.

The central bank left the seven-day repurchase rate at 5.25 percent in Seoul yesterday, as forecast by all 23 economists surveyed by Bloomberg News. The bank raised borrowing costs in August for the first time in 12 months.

Lee said yesterday consumer prices may exceed the bank's 5.3 percent forecast in the second half, stoked by a weaker won and increases in power costs.