Policy to remain steady until inflation tamed, Korea's Choo says

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Policy to remain steady until inflation tamed, Korea's Choo says

Published: 04 May. 2023, 19:32 Updated: 05 May. 2023, 09:23

Finance Minister Choo Kyung-ho speaks at a press conference held during the Asia Development Bank meeting in Incheon Thursday. [NEWS1]

Korea will keep policy consistent to tame inflation, despite the rate’s fall below 4 percent in April.

“It’s too early to shift the policy focus to economic growth from inflation stabilization,” said Finance Minister Choo Kyung-ho at a press conference held during the Asia Development Bank meeting held in Incheon Thursday.

Choo added that a policy shift could trigger inflation, as uncertainties remain inside and outside Korea.

“We plan to focus on stabilizing inflation and solidifying the trend for some time.”

Korea’s inflation was 3.7 percent in April, the lowest in 14 months. The figure was down from the 4.2 percent in March. It was the first time inflation was below 4 percent since February last year.

Choo added that it’s too early to comment on Korea’s growth outlook, which has been lowered by global organizations.

The International Monetary Fund (IMF) slashed Korea’s growth outlook four times, with the most recent projection1.5 percent growth for this year.

“We will review the forecast in June, when establishing the direction for economic policy for the second half.”

The IMF on Thursday said the chip downcycle and China’s service-driven growth is limiting Korea’s growth, despite the country’s “strong” fundamentals.

BY JIN MIN-JI [jin.minji@joongang.co.kr]