Bank of Korea Governor's comments at news conference

SEOUL: South Korea's central bank held interest rates steady for a fourth straight month on Thursday, in line with market expectations, as the world's biggest economies show signs of improvement and domestic inflation remains low.

Following are key remarks from Bank of Korea Governor Kim Choong-soo at a news conference, translated by Reuters:

RATE DECISION:

"The decision to hold interest rates on Thursday was not unanimous."

EXCHANGE RATE:

"We don't use the exchange rate as the anchor to policy, but it would also be inappropriate to say we did not consider the exchange rate in our policy decision given how important a variable it is."

"Exchange rates should be managed so that they follow market fundamentals."

RATE POLICY:

"South Korea's current monetary stance is already accommodative."

"There has been talk that the Bank of Korea is timing its policy for the inauguration of the incoming administration (of Park Geun-hye). We are not delaying our policy decisions because of that issue. While I am not denying there has to be a harmony in policy it is difficult to think that we are putting off our responsibility while (waiting for the new president to take office.)"

GLOBAL ECONOMY:

"The global economy is expected to show modest growth, but downside risks to growth remain including the persisting euro zone debt crisis and the US fiscal consolidation."

DOMESTIC ECONOMY:

"The South Korean economy's negative output gap will persist for a considerable amount of time due to the sluggish pickup in the global economy due to factors including slow economic developments in the European region."

INFLATION:

"Inflation will remain low for the time being in South Korea due to the easing of demand."