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flag South Korea's central bank warned inflation may hit 2% in 2026 if the won stays weak, citing currency depreciation and expected U.S. fund outflows.

flag South Korea’s central bank warned on December 17, 2025, that inflation could rise to the early-to-mid 2% range in 2026 if the won stays near 1,470 to the dollar, citing a spillover effect from currency depreciation. flag Headline inflation held at 2.4% in November, above the 2% target for a third straight month. flag Governor Rhee Chang-yong stressed the need for foreign exchange stability, especially amid expected dollar outflows from a U.S. trade investment fund, and urged the National Pension Service to use more currency hedging to curb its impact on the won, which weakened to 1,480.4 per dollar, nearing a 16-year low.

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