The central bank has kept the key interest rate steady at three-point-five percent for the eighth consecutive time.

The decision was made during the year's first rate-setting session by the Bank of Korea's(BOK) monetary policy board on Thursday, maintaining the largest-ever two-percentage-point gap with the U.S. Federal Reserve's rate.

Following ten post-pandemic hikes amounting to three percentage points through January of 2023, the board has left the rate untouched at three-point-five percent since last year's February session.

The BOK is assessed to have taken into account inflation, which has stayed above three percent for the fifth straight month, as well as persistent growth in household debt.

With its decision, the central bank did not respond to calls for an adjustment amid concerns over non-performing loans centered around project financing(PF) and annual growth plunging down to the one-percent range for the second consecutive year.

While the BOK and the government expect the economy to expand two-point-one and two-point-two percent, respectively, local institutes and financial groups forecast growth to come in under two percent for the second year, citing a slowdown in consumption due to high interest and inflation.