The announcement yesterday of plans for a large fiscal boost in Korea’s draft 2020 budget has led us to revise up our Korea growth forecast for next year to 2.5%, from 2.0% previously. That said, we doubt the plans will deter the Bank of Korea from cutting its policy rate again this year, having left rates on hold this morning. Otherwise, a host of inflation data next week are set to show that price pressures remain very weak, paving the way for central banks elsewhere to cut further this year as well.
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