No Discord After All
Deputy Prime Minister and Minister of Strategy and Finance Choi Kyung-hwan and The Bank of Korea Governor Lee Ju-yeol said on the same day that their determinations on the current national economic conditions are not much different from each other.
The former recently said that he would relax three macroeconomic regulations associated with the forward exchange position, taxation on foreign bond investments, and macro-prudential stability levy to provide against the capital outflow expected to follow the interest rate hike in the United States. The latter, in the meantime, hinted at an interest rate cut for corporate investment promotion ahead of the Monetary Policy Committee meeting scheduled for Oct. 15. Both of them are staying in Washington D.C. for the G20 Financial Ministers and Central Bank Governors Meeting and the IMF and World Bank Annual Meeting and made the remarks on separate press conferences held on Oct. 11 (local time).
“I would like to stress that the Korean government has basically the same view as the Bank of Korea when it comes to the current state of the Korean economy,” said Mr. Choi, adding, “The consensus is that the recovery of the Korean economy is still rather slow, although both organizations may make slightly different decisions.”
The central bank governor also said, “Many people are talking about the different diagnoses between the government and the central bank, but the fact is that the gap in view is very narrow at best.” He mentioned as well that the government’s timely measures contributed greatly to the economic sentiment on the consumption side, though corporate sentiment and investment have yet to recover much.