According to the nominee for governor of the Bank of Korea, Shin Hyun-song, the country's current policy rate is broadly at a neutral level based on various assessments, indicating there is no urgent need for significant adjustments to monetary policy at this time.
He noted that the recent depreciation of the South Korean won is primarily driven by external factors, including rising oil prices and heightened risk aversion due to escalating tensions in the Middle East.
Shin emphasized that monetary policy should be evaluated within a broader context, pointing out that estimates of the neutral interest rate involve considerable uncertainty. He also stressed the importance of considering overall financial conditions and the impact of policies.
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