Bank of Korea governor urges ‘harmonious’ mix of monetary, fiscal policies

SEOUL (Reuters) – South Korea’s central bank governor said on Monday that changing economic conditions had limited the effectiveness of monetary policy, which needed to be implemented in harmony with government spending.

“We need to realize the limitations of monetary policy and actively pursue a proper policy mix (with government spending,” Bank of Korea Governor Lee Ju-yeol said in a speech in Seoul.

Lee said need for harmonized policies was especially strong when demand was persistently weak, without specifying whether that applied to current economic conditions.

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