BOK chief says weak inflation, job market obstacles to policy tightening

SEOUL (Reuters) – South Korea’s central bank chief on Thursday said the Sino-U.S. trade conflict, as well as weak inflation and a weak job market at home are obstacles to tightening monetary policy.

“There is no change in stance that the extent of monetary policy easing needs adjusting given the accumulating financial imbalances and macro-economic situation,” Governor Lee Ju-yeol told reporters.

“But the trade conflict between the U.S. and China is worsening beyond expectations, while the inflation and job market situation aren’t appropriate to raise interest rates,” Lee said.

Lee was taking questions from reporters after the U.S. Federal Reserve raised interest rates by a quarter of a percentage point to a range of 2.00 percent to 2.25 percent.

The BOK held its policy rate steady at 1.50 percent in a 6-1 vote at the end of last month, citing doubts about job market recovery and weak inflationary pressure.

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