Potential Stimulus
During his visit to the U.S. for the meeting of G20 finance ministers, Finance Minister Choi Kyung-hwan said, “We will implement an additional economic stimulus plan in the second half of this year if needed.”
In the interview with CNBC on April 16 (local time), he said, “We will have to keep our eyes on the market during the first half of this year to see how the policy plays out after we had implemented expansionary macroeconomics last year.”
In regard to the recent economic situation, he said, “We are seeing some recovery in the market due to the implementation of expansionary macroeconomics.”
Regarding a question about the possibility of the Bank of Korea (BOK) to lower its record low standard interest further to support the economy, he said, “That decision would be an independent decision that the BOK would have to make. As far as the recovery of the economy is concerned, there are some different views, so the Bank will have to keep a close eye on the market, and see what changes are taking place, and accordingly make the changes.”
BOK Governor Lee Ju-yeol, who also attended the meeting, also agreed that Korea does not have to raise the interest rate because the U.S. does so, and said, “The monetary policy is a short-term macro-economic policy to deal with cyclical reasons. In order to raise growth potential, we need to reform the structure.”