The Bank of Korea, South Korea's central bank, left the call rate unchanged at 3.75 percent for August in a monetary policy committee meeting Thursday.

The call rate is the nation's benchmark short-term interest rate charged on one-day, inter-bank loans.

Following its decision to keep the key interest rate intact, the central bank said that despite sluggish consumption, the nation's economy is improving thanks to solid exports and the subsequent increase in industrial output.

The bank also said that consumer prices marked a decline in July for the fourth straight month largely due to cutbacks on special excise taxes on home appliances and automobiles.

BOK Governor Park Seung stressed that such developments would be closely monitored to determine whether the recent economic improvement is only temporary.

He added, however, that the bank was still sticking to its previous forecast that the economy would rebound in the second half.