[Hanae Big Step] FKI "Need to Adjust the Pace of Future Interest Rate Hikes"

Comments on the Bank of Korea's Big Step Interest Rate Hike to 2.25%

Bank of Korea Governor Lee Chang-yong is explaining the results of the Monetary Policy Committee meeting held on the morning of the 13th at the Bank of Korea briefing room in Jung-gu, Seoul, and answering questions from the press. To curb soaring inflation, the Bank of Korea ultimately took a 'big step' by raising the base interest rate by 0.50 percentage points (p) at once for the first time in history. (Image source=Yonhap News)

[Asia Economy Reporter Moon Chaeseok] The Federation of Korean Industries (FKI) stated on the 13th that as the Bank of Korea's Monetary Policy Committee raised the base interest rate by 0.5 percentage points (p) to 2.25% at once, "it is necessary to adjust the pace of future interest rate hikes."

Choo Kwang-ho, head of the FKI's Economic Headquarters, said, "Despite concerns about an economic recession, the Bank of Korea's decision to raise the base interest rate by 0.5%p at once was judged to be a measure considering the recent sharp rise in consumer prices and the aggressive interest rate hike stance of the United States."

Choo emphasized, "However, since the financial resilience of households and companies is weak and the real economy is sluggish, it is necessary to adjust the pace of future interest rate hikes."

He added, "While paying attention to the interest rate inversion phenomenon with the United States, the government should ease the burden of interest rate hikes through efforts to stabilize the won's value, such as turning the trade balance into surplus."

He continued, "It is also necessary to create a business-friendly environment through regulatory reforms and tax improvements to strengthen the fundamentals of the Korean economy and enhance global market confidence in the Korean economy."

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