1st LD: S. Korea freezes interest rate at record low despite positive signals

South Korea's central bank on Thursday froze its benchmark interest rate at an all-time low of 1.25 percent despite positive signals from the export-driven economy.

Bank of Korea (BOK) Governor Lee Ju-yeol and six other policy board members refrained from altering the seven-day repurchase rate, which has been on hold at the current level since June last year.

It was in line with market expectations. According to a Korea Financial Investment Association survey of 200 fixed-income experts, 99 percent had predicted this month's rate freeze.

Recent economic indicators showed signs of recovery. Exports, which account for about half of the economy, kept a growth momentum for five straight months through March when the overseas shipments posted a double-digit expansion.

Retail sales, which reflect private consumption, increased 3.2 percent in February from a month earlier. Revenue in department stores grew 1.7 percent in March, with credit card usage recording a double-digit increase.

Confidence among South Korean consumers improved as political uncertainty eased following a historic ruling on March 10 to remove then President Park Geun-hye who was impeached in the parliament in December.

Global investment banks recently revised up their 2017 growth outlooks for the South Korean economy, according to data compiled by Korea Center for International Finance. It was 2.5 percent on average as of end-March, up 0.1 percentage point from a month earlier. Endit