JP Morgan Thursday predicted the Bank of Korea (BOK) may raise the overnight call rate in October without any improvement in the economic conditions.

JP Morgan also said Korea's economic growth will slow down in the second half of the year, noting the pace in industrial output growth was lower than expected in July.

It also cited weakening exports and domestic consumption caused by enhanced regulations on use of credit cards and termination of the excise tax exemption on automobiles.

JP Morgan, however, forecast the mid-term outlook for Korea's economy will be positive, saying the U.S. economy will rebound in a U-shape economic recovery pattern without falling to a double dip recession.