SEOUL, September 30, 2024 – South Korea's central bank governor, Rhee Chang-yong, indicated that discussions regarding potential interest rate cuts will be necessary at upcoming board meetings. This comes in light of recent government measures aimed at addressing escalating household debt levels.
Governor Rhee stated, “I have not yet been able to discuss with monetary policy board members the effects of government policies,” highlighting the need for thorough deliberation before making any decisions about lowering the current policy rate of 3.50 percent, the highest since late 2008.
The Bank of Korea's next rate-setting meeting is scheduled for October 11, where expectations are building for a possible rate cut to stimulate domestic demand. While one board member has noted that the government's measures to curb household debt are expected to take effect gradually, others remain cautious, citing the need for more data on the situation.
The implications of a rate cut could be significant, potentially influencing economic growth and consumer spending in South Korea, which may also resonate through global markets as countries monitor the economic health of major economies.
This information is sourced from Channel News Asia.