Bank of Korea raises key interest rate to 2.25% from 1.75%

South Korea's central bank, BoK, has hiked its key rate to 2.25% from 1.75%. This follows a 25-basis-point increase in the previous meeting in May. It is the first time that the central bank has raised the benchmark rate by 50 basis points, taking a so-called "big step."

In May,  the BoK's newly-appointed Governor Rhee Chang-yong, due to chair his first policy meeting on Thursday, said he could consider bigger interest rate increases in coming months. The outcome was expected based on a majority view of 17 of 28 economists prior to the decision.