Central bank reports won’t just cover rates

The Bank of Korea’s Monetary Policy Committee, a group of seven policy makers including central bank governor Lee Seong-tae, will begin offering commentary on the future of the economy along with its monthly statement on the nation’s benchmark interest rates.
The move is in response to growing complaints that the statement offers few insights to market players.
According to Bank of Korea officials, the Monetary Policy Committee plans to include in its monthly statement more specific views about the economy as well as details of future plans. Officials have not yet decided when the policy will take effect.
The seven policymakers on the committee meet every month to decide whether to change the rate on overnight inter-bank loans, Korea’s benchmark interest rate. Investors here and abroad, particularly bond traders, anxiously await the committee’s pronouncement for clues to the future of the economy and to decide on investment positions. The committee meets on the second Thursday or Friday of every month.
“The statements so far have been too brief and mostly an explanation about the current economic situation; thus they offered very limited signals about the central bank’s take on the future economic situation,” said one Bank of Korea official who declined to be named.

By Jung Ha-won Staff Writer [hawon@joongang.co.kr]