Lee Ju-yeol "Difficulties in Some Groups, Fiscal Policy More Effective Than Monetary Policy"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Eun-byeol] Lee Ju-yeol, Governor of the Bank of Korea, regarding the indication of a base interest rate hike within the year, stated, "If the economic situation improves, we are communicating with the market in advance about the plan to start normalization to mitigate the side effects of prolonged low interest rates during that period."

On the 16th, Governor Lee appeared before the National Assembly's Planning and Finance Committee and, in response to a question from Yang Kyung-sook, a member of the Democratic Party of Korea, said, "We understand that self-employed individuals and small business owners in face-to-face service industries, as well as those in unstable employment, who have borrowed money, will face difficulties in repaying interest."

He added, "While we fully understand the difficulties faced by some groups due to the interest rate hike, I believe that going forward, fiscal policy would be more effective than monetary policy," and said, "We will also consider possible measures at the Bank of Korea level, such as financial intermediary support loans."

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