Bank of Korea’s Rhee Chang-yong on Interest Rate Cuts Amid Political Turmoil

Governor Rhee Chang-yong’s Statement

On Thursday, Bank of Korea (BOK) Governor Rhee Chang-yong expressed concerns regarding the continuation of interest rate cuts. He remarked that these cuts could potentially create anxiety among investors and stakeholders. This statement comes at a crucial time as the BOK prepares for its next interest rate decision, set for later this month.

Economic Context in South Korea

South Korea is currently grappling with its most significant political crisis in decades. The turmoil was ignited by President Yoon Suk Yeol’s brief imposition of martial law, ultimately leading to his impeachment. This political instability poses various economic risks, further complicating the BOK’s monetary policy decisions.

Looking Ahead: Monitoring Risk Factors

Governor Rhee emphasized the need to closely monitor the evolving risk factors associated with both the domestic economy and international markets. The BOK’s approach will be crucial in determining the pace of monetary policy adjustments. Stakeholders are advised to stay informed as the bank navigates these volatile conditions that may dictate future interest rate movements.

His comments later:

⚠️ BANK OF KOREA GOVERNOR RHEE:

**ECONOMY FACING NEW DIFFICULTIES OF GROWTH RISKS, HEIGHTENED FX VOLATILITY

**FX VOLATILITY COULD PERSIST FOR CONSIDERABLE TIME

**THIS YEAR’S ECONOMIC CONDITIONS SEEN MORE DIFFICULT THAN EVER BEFORE

**MONETARY POLICY NEEDS TO BE FLEXIBLE AS POLITICAL, ECONOMIC UNCERTAINTY UNPRECEDENTEDLY HIGH

**PACE OF RATE CUTS WILL BE FLEXIBLE

**DOWNSIDE RISKS TO 2025 GDP FORECAST OF 1.9% HAVE GROWN

-PIQ Suite News

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