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Bank of Korea governor Lee Ju-yeol said on the 31st, “We will consider the employment situation as an important factor in monetary policy management.”
In the 2021 New Year’s address distributed on the day, President Lee said, “In the situation of the new coronavirus infection (Corona 19) crisis, there has been a growing demand to specify job security as one of the bank’s legal obligations.”
He said, “Just because employment stability supports sustainable growth and improves the quality of life of the people, the employment situation should be considered as a judgment factor in the operation of monetary policy,” he said. “However, if monetary policy is operated with a number of conflicting goals, As it can be difficult to maintain consistency, we need to derive an optimal plan that fits our circumstances, such as referring to domestic and international studies and cases.”
Governor Lee said, “Next year, the global economy and international trade will gradually improve, and the domestic economy will gradually recover,” he said, but pointed out that there are still several challenges such as the re-proliferation of Corona 19 and trade conflict.
He also diagnosed that “the Korean economy continues to be concerned about structural vulnerability,” and said, “While low birthrates and aging populations are limiting the vitality of the economy, the discriminatory effects of Corona 19 are deepening the imbalance between sectors and classes.”
“If the future economic recovery develops in the form of a’K’ character, there is a high possibility that small business owners and low-income groups, mainly in the traditional face-to-face industry, will continue to be alienated from the recovery.” Expansion can act as a factor that weakens the ability of economic actors to respond to external shocks.”
Governor Lee said, “While supporting the economic recovery through an expanding macroeconomic policy, we need to strengthen selective support to accelerate the recovery of vulnerable sectors that have suffered from Corona 19.” We must prepare in advance how to normalize while checking the development situation of 19,” he said.
Governor Lee reaffirmed that although the Korean economy will recover gradually, he will continue to pay attention to financial stability and maintain an easing monetary policy stance, as uncertainties in the growth path are high.
“If necessary, the financial and foreign exchange market stabilization measures should be implemented in a timely manner,” he said. “The potential risk factors for financial stability should be strengthened and examined.”
Regarding the authority to manage and supervise payments and settlements in financial transactions that have recently conflicted with the Financial Services Commission, he said, “We need to establish an institutional foundation in the direction of more clearly establishing the role and responsibilities of the BOK.”
In addition, he said, “Central Bank Digital Currency (CBDC) should conduct a pilot system construction and test in a virtual environment as planned, and a plan to establish a rapid money transfer system based on real-time total payment (RTGS) should be reviewed.”
/yunhap news
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