BoK’s Rhee: Do not want to rule out possibility of rate cut within this year

Dhwani Mehta FXStreet

Bank of Korea (BoK) Governor Rhee Chang-yong addresses the press conference following the central bank’s monetary policy meeting on Thursday.

Key quotes

Thursday's rate decision was unanimous.

Household debt increase in last couple months was faster than expected.

Will manage household debt with micro measures first.

May consider macro policy to tackle household debt, but not for now.

Six members wanted to keep door open for one more hike.

Uncertainty very high regarding US monetary policy.

Too early to talk about rate cut.

Do not want to rule out possibility of rate cut within this year.

Undesirable to comment on whether Korea can cut interest rates before US.

Interest rates at upper end of neutral range or higher.

Foreign exchange rates not at level of concern.

Downgrade in 2024 GDP forecast due to weaker chinese economy.

Can intervene if market volatility increases after us policy meeting in Sept.

Some might argue for more weight on growth, but inflation most important for now.

Also: BoK holds interest rates unchanged at 3.5%, as expected, but drags USD/KRW below 1,330

Market reaction

USD/KRW is holding lower ground near $1,324 despite the dovish remarks from the BoK Governor. The pair is trading 0.28% lower on the day at $1,324.43 at the time of writing.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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