Doha: South Korea’s central bank kept its benchmark interest rate unchanged Thursday to maintain financial stability amid a red-hot housing market and a weakening currency. In a widely expected decision, the Monetary Policy Board of the Bank of Korea (BOK) held its key rate steady at 2.5% during its rate-setting meeting in Seoul.

According to Qatar News Agency, the policy room for the Bank of Korea has been limited as surging home prices in Seoul and nearby areas have fueled household debt. The government has rolled out a series of measures to cool the real estate market. Most recently, the government designated 21 additional districts in Seoul as speculative zones, bringing all 25 districts in the capital under tougher regulations.

The local currency has fallen well below 1,420 per dollar, its lowest level in months, amid the continued strength of the US dollar and uncertainties surrounding tariff negotiations with the United States. A rate cut could further weaken the won and trigger capital outflows. The local currency opened at 1,431.8 per dollar Thursday, down 2 won from the previous session.

Thursday’s decision left the gap between South Korea’s and the US’ key interest rates at up to 1.75 percentage points. At its September meeting, the Federal Reserve cut its benchmark rate.