Bank of Korea Governor Urges Cautious Monetary Policy
Governor Shin Hyun-song began his term on Tuesday by urging cautious policy amid Middle East tensions. He noted rising inflation risks and growth uncertainty.
The newly-appointed governor of the central bank in South Korea stated on Tuesday that monetary policy must remain both cautious and flexible. This approach is necessitated by intensifying uncertainty regarding inflation and economic growth, largely driven by ongoing conflicts in the Middle East. During his inauguration address, Governor Shin Hyun-song highlighted the supply shocks resulting from regional instability as a primary concern for the national economy. > "As uncertainty has increased over inflation and growth paths due to the supply shock caused by the Middle East war, it is necessary to seek price stability and financial stability through cautious and flexible monetary policy operations," Governor Shin Hyun-song said in his inauguration speech. The Governor noted that the escalation of tensions involving Iran has led to a surge in global oil prices. This trend exerts simultaneous upward pressure on inflation and downward pressure on economic expansion, while also increasing volatility across financial markets and raising the risk of financial instability. Shin Hyun-song, who officially began his four-year term on Tuesday, is scheduled to lead his first policy-setting meeting on May 28.
