SEOUL: South Korea’s new President Yoon Suk-yeol said on Friday he was worried about slower economic growth for the year ahead, with the country logging a trade deficit and currency markets growing more volatile.
“Financial and FX market volatilities are increasing due to the fallouts from the COVID pandemic and global supply chain hiccups, along with inflation and global monetary policy responses, while swinging into trade deficits and slower economic growth are also our concerns,” Yoon said, hosting his first official policy meeting on the economy with the finance minister and the governor of the central bank.
On Thursday, the won closed onshore trading at the weakest level since July 2009, sparking worries that a weaker currency could further fuel inflation now at a 13-year high.
The won has depreciated 7.7% against the dollar so far this year.
The central bank in April raised its benchmark interest rate by 25 basis points to 1.50% in a surprise move to ramp up the fight against inflation, and now faces pressure to do more as the US Federal Reserve takes an aggressive approach to raising rates.
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It is rare for the presidential office to hold a policy meeting with both the finance minister and the Bank of Korea Governor as attendees.
BOK Governor Rhee Chang-yong began his four-year term in April, and Choo Kyung-ho began his job as Yoon’s first finance minister in early May.
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