Bank of Korea chief says no automatic policy tightening in second term

FILE PHOTO - Bank of Korea Governor Lee Ju-yeol speaks during a news conference in Seoul, South Korea, November 30, 2017. REUTERS/Kim Hong-Ji

SEOUL (Reuters) - South Korea’s central bank chief said on Thursday his re-appointment to lead the Bank of Korea for a second four-year term would not mean an automatic acceleration of policy tightening.

Governor Lee Ju-yeol is scheduled to attend a parliamentary confirmation hearing on March 21 before he starts his second term in April. Lee was reappointed by President Moon Jae-in to lead the BOK for another four years.

The confirmation hearing is largely a formality as lawmakers lack the power to block the nomination if President Moon Jae-in presses ahead with it. Asked to comment on market views that his reappointment may lead to an increase in the pace of interest rate hikes, Lee said in a statement:

“As was the case until now, the Monetary Policy Board will comprehensively consider the economic conditions, inflation trends and financial market situation to decide the benchmark interest rate.”

This would include monitoring the U.S. Federal Reserve’s Open Market Committee meeting scheduled for March 20-21.

The BOK is due to review monetary policy on April 12.

Reporting by Cynthia Kim; Editing by Eric Meijer