SEOUL — The Bank of Korea, the first major central bank in Asia to hike rates since the onset of the pandemic, began slowing down its pace of monetary tightening amid rising credit stress in the country’s corporate bond market.

The central bank on Thursday raised its key rate by a quarter of a percentage point to 3.25%, following a half-point increase last month. BOK Gov. Rhee Chang-yong had initially signaled a bigger move, but later hinted at a slowdown citing unfavorable market conditions.

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