Outgoing Bank of Korea senior deputy governor said strong growth feeding into
potential inflation may require further rate increases, while won strength and
recent equity moves give policymakers some policy flexibility. He said KOSPI’s
recent drop and a stabilizing won offer MPC members limited room for maneuver,
but are not decisive. Policymakers will focus on whether core inflation remains
elevated, whether growth can be sustained, and on financial-stability risks.
Headline CPI fell to 2.8% last month but remains above the Bank of Korea’s
target; core CPI rose to 2.6%. Some economists still expect another rate hike
this month after a July increase.
