(Adds details, background, analyst comment)
* All 32 analysts surveyed saw the base rate steady
* Base rate unchanged at 0.50%, analysts see hikes from 2022
* Governor Lee’s press conference to start at 0220 GMT
SEOUL, April 15 (Reuters) – South Korea’s central bank held interest rates at record lows on Thursday as policymakers worry rising coronavirus cases could derail the economic recovery even as they keep an eye on building price pressures.
Bank of Korea (BOK) kept the seven-day repurchase rate unchanged at 0.5%, where it has been held since May last year. The move was expected by all 32 analysts surveyed by Reuters this week.
BOK Governor Lee Ju-yeol said in late March the central bank saw the economy rebounding this year faster than earlier expected, powered by stellar chip exports and an uptick in consumption.
Analysts expect surging home prices and faster inflation to push policymakers to start raising interest rates in 2022, but not sooner, due to uncertainty over the recent spike in coronavirus cases. South Korea’s consumer price inflation hit a 14-month high in March.
“Policymakers would be in no rush to hike rates until the end of next year as downside risks to growth are emerging from the resurgence in coronavirus cases,” said Lee Mi-sun, an analyst at Bookook Securities before the rate decision.
“Job growth remains weak and noises over vaccine deployment programmes are likely to put the brakes on the recovery, although exports are strong.”
South Korea reported 731 new coronavirus cases on Tuesday, the highest daily tally since early January.
Meanwhile, policymakers are also keeping an eye on rising property prices amid concerns they could swell an already hefty household debt pile. Seoul apartment prices surged 28% since early 2020, data from KB Kookmin Bank shows.
The central bank previously said it expected the economy to grow 3% this year. Asia’s fourth largest economy contracted by 1.0% in 2020, the worst since 1998, due to the fallout of the COVID-19 pandemic.
$1 = 1,109.4000 won Reporting by Cynthia Kim; Editing by Ana Nicolaci da Costa
