Bank Of Korea Chairman Hints For Additional Interest-Rate Cut

The chairman of the Bank of Korea (BOK) Jeon Churl-Whan said yesterday that monitoring the economic activity and the consumer price, the government is to apply a flexible currency policy since the domestic and international economy has been unstable. It can be interpreted as that if the stagnation of economy continues, the government is likely to boost the domestic economy through an additional interest-rate cut.

At the 2nd Expanded Conference at which all managing staffs, heads of bureaus and departments, and branch managers attended, Chairman Jeon spoke about the direction of the currency and credit policy.

He said, ``Although the current financial market is stable, it may become unstable again worsening the profitability of the enterprises, if the reconstruction of major companies dose not progress well, or if the stagnation lasts for a long time.

About the consumer prices, chairman Jeon stressed, ``There is a high chance of breaking the goal made early this year. But, we will do our best to construct a foundation to maintain the mid and long-term price index as secure as possible. For that reason, a strict management of the public service charge imposed by the central and regional government is necessary.``

Lee Heon-Jin mungchii@donga.com