The Bank of Korea decides its policy rate this week, while China releases third-quarter growth data.
The BOK's Monetary Policy Board meets on Oct. 22 to decide whether to adjust the base rate, currently at 3.00%. The board raised the rate by 0.25 percentage point in both July and August. Most market participants expect the board to hold this time rather than deliver a third straight increase, pausing to assess the effects of the back-to-back hikes. Still, with growth projected above 3% this year and both inflation and the property market remaining unstable, the board is expected to signal that it maintains a bias toward further tightening.
Ahead of that decision, the BOK releases its producer price index for September on Oct. 21. Producer prices feed into final consumer goods prices after a lag and are viewed as a leading indicator for consumer inflation. In South Korea, producer prices rose on a month-on-month basis for nine consecutive months from September last year, were flat in June, then fell in July for the first time in 11 months, by 0.4%, before rising again in August, by 0.2%.
Parliament also holds comprehensive audits of major economic agencies. The Fair Trade Commission faces its audit on Oct. 21, the Ministry of Finance and Economy on Oct. 22, and the Ministry of Planning and Budget and the Bank of Korea on Oct. 23.
Abroad, attention turns to China's third-quarter gross domestic product growth. After expanding 5% in the first quarter, the economy grew just 4.3% in the second quarter, the weakest reading since the fourth quarter of 2022, when growth slowed to 2.9% under the shock of the pandemic. The market forecast for the third quarter is 4.4%. That has prompted expectations that Beijing will struggle to meet its target of 4.5% to 5% growth this year. The People's Bank of China also announces its loan prime rate, which effectively serves as the country's benchmark rate. The rate has been held for 16 consecutive months through last month and is likely to stay unchanged again.
Japan's consumer price data also bears watching. Consumer inflation ran at 1.9% year-on-year in August, and September is expected to come in as high as 2.2%. A wider increase could sharpen expectations for another rate hike by the Bank of Japan.
Elsewhere, third-quarter earnings from Netflix, Tesla and IBM are among the week's main events.
