Summary
- Bank of Korea Governor Lee Chang-yong indicated 1-2 additional base rate cuts this year.
- The Monetary Policy Committee lowered the rate to 2.75%%, and some members stated that the possibility of additional cuts should remain open considering downward pressure on the economy.
- Emphasized that monetary policy is in a rate cut phase and timing of cuts will be determined based on data.
Bank of Korea Governor Lee Chang-yong announced on the 25th that there will be 1-2 more base rate cuts this year. At a press conference following the Monetary Policy Committee meeting, Governor Lee stated, "The market's expectation of 1-2 more rate cuts this year is not significantly different from our assumptions."
The Monetary Policy Committee lowered the base rate from 3.0% to 2.75% per annum today. This decision was unanimous among committee members. Regarding the interest rate outlook for the next three months, Governor Lee reported that "four out of six Monetary Policy Committee members believe the base rate is likely to remain at 2.75% per annum within three months." He added that "the remaining two members suggested keeping open the possibility of lowering it below 2.75%."
Governor Lee explained, "Four members expressed concerns about rapidly depleting room for additional rate cuts amid high uncertainty in domestic and foreign policy conditions." He added, "The other two members suggested it would be better to keep the possibility of additional cuts open and make decisions based on changing conditions, considering downward pressure on the economy."
Governor Lee added, "However, all six members agreed that monetary policy is in a rate cut phase, and concurred on determining the timing of cuts based on data going forward."
Reporter Kang Jin-kyu josep@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
