SEOUL (Reuters) – South Korea’s central bank will consider trade-offs among the recent disinflation trend, growth and financial stability for future monetary policy operations, its governor said on Tuesday.
Governor Rhee Chang-yong said in his remarks at a parliamentary session that disinflation was expected to continue after recent positive signs, while noting a pick-up in household debt growth and heightened volatility in foreign exchange markets.
The Bank of Korea is expected to keep its policy rate on hold at a 15-year high of 3.50% on Thursday and through the third quarter of 2024, before a 25-basis-point cut in the final quarter, around the same time as a likely start of policy easing by the U.S. Federal Reserve, according to a Reuters poll.
(Reporting by Jihoon Lee; Editing by Christian Schmollinger)
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