Major global investment banks have predicted there will be another key interest rate cut in South Korea this year.

In the latest monthly compilation of economic outlooks by global investment banks on Friday, the Korea Center for International Finance(KCIF) said they expected the Bank of Korea(BOK) to cut the benchmark rate around October.

In the report, the global IBs said the BOK froze the rate for this month on Thursday, because key economic indicators showed a mixed response to the central bank's rate cut to a record low of 1.25 percent in June.

However, they said the BOK will be tempted to slash the rates again this year as the country will suffer more fallout from sluggish global trade and domestic corporate restructuring efforts.

Standard Chartered and Credit Suisse said the strengthening of the won is boosting the possibility of an additional rate cut in the near future.  

Nomura and HSBC predicted the BOK will lower the benchmark rate in the first quarter of next year in addition to the fourth quarter this year, while Morgan Stanley said there will be three more rate cuts by the second quarter of next year.