February 20, 2018 / 11:32 PM / a month ago

South Korea central bank chief says ready for rapid Fed rate hikes

SEOUL (Reuters) - South Korea’s central bank chief said on Wednesday the Bank of Korea is prepared to respond to any negative impact from faster-than-expected policy tightening in the U.S.

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

“If (the Fed moves) faster than expected, it will immediately impact international financial markets and also domestic markets as well, so we’re prepared to respond to such a scenario,” Governor Lee Ju-yeol told reporters in Zurich after signing a bilateral currency swap with Switzerland.

Lee said the Bank of Korea expects the U.S. Federal Reserve to raise policy rates three times this year.

One of the headwinds for South Korea’s economy this year is U.S. protectionist moves against South Korean exporters, Lee added.

Reporting by Cynthia Kim; Editing by Eric Meijer

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