The average interest on bank loans extended to households topped four percent last month to reach the highest rate in more than eight years.

According to the Bank of Korea on Tuesday, the interest rate on household loans went up by zero-point-07 percentage points to four-point-05 percent in April, the highest since March 2014.

Rates on mortgage loans also edged up to three-point-nine percent on average last month, the highest in more than nine years since March 2013.

The interest on credit loans jumped even more sharply by zero-point-16 percentage points to five-point-62 percent, the highest in seven years and ten months.

The cost of borrowing for companies also rose to three-point-45 percent in April, the highest since July 2019.

The increases come as the central bank raised its policy rate earlier this month in a second straight policy rate setting meeting to combat inflationary pressure.