The Bank of Korea (BOK) kept its benchmark interest rate steady Thursday and held its policy stance at a hawkish level. The central bank raised its estimates for economic growth and is very optimistic about the country’s continued export push.

The Board of the monetary policy unanimously decided to keep the seven-day repurchase rate unchanged at 3.00%. A temporary pause was needed to assess the external risks and to gauge how far the economic impact of the bank’s back-to-back rate hikes in July and August had reached, the central bank said.

The financial officials and authorities that are aligned with the Ministry of Economy and Finance have predicted that this year and next year growth rates will be much higher than August’s 3.3% and 2.9%, respectively. In addition, the year-over-year rates of both headline and core inflation are expected to be higher than the previous estimates by the central banks.

At a recent press conference, BOK Governor Shin Hyun Song refused to make specific comments on the terminal interest rate forecast. He said that the bank will adjust its stance continually depending on the market sentiment as it changes, and not just according to the prevailing sentiment.

The governor’s stance on this was echoed in the other words of this flexible yet restrictive approach in the event, hosted by the International Monetary Fund (IMF) in mid-October. The analysts have now their rate outlook for the summit policy rate at 3.50%, and the experts in the market have pointed out that a delay in raising the rate could tarnish the reputation of the bank in the battle against inflation.

South Korea’s monetary moves are being considered in the wake of September’s Federal Reserve rate hike, which has left the Fed’s target rate at 4.00%. Market expectations are that the Fed will keep rates unchanged in October before raising them again in December for the year.

Domestically, the latest data from various organizations such as the Korea Statistics Bureau indicate that the headline consumer inflation rate also edged down to 2.9% in September from 3.1% in August. On the positive side, this cooling off did not bring the inflation rate down from the central bank’s tight 2% target, which means more monetary tightening is still in the cards.