Candidate Chang-yong Lee of the Bank of Korea to raise the base rate, I agree with you

Candidate Chang-yong Lee for governor of the Bank of Korea answers questions from reporters as he arrives at the personnel hearing office set up in the Buyeong Taepyeong Building in Jung-gu, Seoul on April 1st.[사진=사진공동취재단]

Bank of Korea candidate Lee Chang-yong announced on the 14th that he agrees with the recent decision by the Monetary Policy Committee (Monetary Policy Committee) to raise the key interest rate.

In a written response submitted to Democratic Party lawmaker Yang Kyung-sook, who is affiliated with the National Assembly’s Planning and Finance Committee, on the 17th, Lee said, “I am cautious about directly evaluating the decisions of the Monetary Policy Committee, but I believe that the members made an appropriate decision considering the financial and economic situation comprehensively. It is not different from what I think.”



However, a line was drawn on whether to pre-arrange or not. He explained, “I have met the Monetary Policy Committee members once since I left for work on April 1, but it was only a meeting. .



Regarding the question of whether an interest rate hike would be desirable, Lee said, “As the high inflation rate is expected to continue for a considerable period of time while the economy continues to recover, monetary policy will be operated in the direction of promoting price stability through appropriate adjustments to the degree of easing. It is a position that it is desirable to do,” he replied.



Candidate Lee explained that it is necessary to be vigilant about the recent price situation.



He said, “In the future, high inflation is expected to continue for a considerable period of time due to the rise in raw material prices due to the Ukraine crisis.” We need to be on the lookout for possibilities.”



Regarding the question of whether the soft landing of household debt and a ‘mismatch’ by raising the base rate as the new government is pushing for easing of loan regulations, he said, “The current loan regulation adjustment planned by the new government will focus on protecting end-users such as first-time home buyers. “I know that it is being pursued at a micro level in line with it,” he explained.



“However, as these micro-measures affect macroeconomic conditions and overall financial conditions such as market liquidity during the implementation process, it is necessary to take these measures into account in monetary policy operation if their impact grows larger,” he said. Policy authorities should make efforts to communicate and coordinate with each other to achieve harmony while operating according to the goals pursued by each.”



Candidate Lee pointed out that the supplementary budget could put pressure on inflation, saying, “The current supplementary budget is expected to be implemented at a micro level, focusing on supporting small business owners and the self-employed. “If the scale of these micro-measures is large and has the potential to affect macroeconomic conditions such as inflation, it is important to make efforts to harmonize monetary and fiscal policies.”

Meanwhile, the candidate’s personnel hearing will be held on the 19th.


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