Bank of Korea raises interest rates by 25 basis points to 3% as the AI boom lifts growth

The Bank of Korea increased its interest rate by 25 basis points to 3% and raised growth forecasts, driven by an AI boom confirmed by Nvidia's strong second-quarter results.

US · 2026-08-27

Bank of Korea raises interest rates by 25 basis points to 3%. Cost headwind for SMEs: a slowdown in investment and expansion plans due to higher borrowing costs. Named: companies Bank of Korea, NVIDIA CORP.

1. Step 1 · The triggerthe Bank of Korea raises interest rates to 3% to combat inflation and support growth
2. Step 2 · Knock-onhigher rates in South Korea influence global lending rates, including those in the US
3. Step 3 · Knock-onUS SMEs face increased financing costs as lenders adjust to the new rate environment
4. Step 4 · Reaches youSMEs may see a slowdown in investment and expansion plans due to higher borrowing costs

The trigger is reported by the source below. The steps that follow are Branch²’s traced reasoning — how the shock could reach a business like yours, not a prediction.

Source: MarketWatch

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