Korea Business News Agency - NSP NEWS AGENCY.

After the meeting to check the market status on February 1, Bok-hyun Lee, governor of the FSS; Changyong Lee, the chief of BoK; Sangmok Choi, the Deputy Prime Minister of MEE; and Joohyun Kim, Chairperson of FSC, (from left to right) are taking a photo. (Photo = Bank of Korea)

(Seoul=NSP NEWS AGENCY) = For the frozen base rate to 5.25 to 5.55% by the US Federal Reserve System (Fed), the Bank of Korea (BoK) says, “We will closely monitor the financial and foreign exchange markets home and abroad as the Fed highlights data-driven decision making.”

On February 1, BoK held a “meeting for checking market status” to look into international financial markets and the effects on the Korean financial and foreign exchange markets caused by the US’s Federal Open Market Committee (FOMC).

The Fed left the policy rate unchanged at this FOMC meeting, signaling that it was less likely to decrease the interest rate in the coming March, unlike investors' expectations.

The US financial market saw a downward trend of stock prices (S&P 500 went down by -1.6%), a strong dollar (+0.1%), and decreased treasury yield (2-year US treasury bond went down by -13 bp) caused by less-than-expected Employment Cost Index and concerns about reemerged local bank crisis.

Regarding the issue, the senior deputy governor of the BOK said, “The FOMC shows Fed’s position on possible adjustment for the policy rate in the future, but an extremely cautious stance on the early rate cut.”

Jerome Powell, the Chair of the Fed, mentioned a risk that inflation may stuck higher than 2% and highlighted a need for stronger confidence that the inflation would reach the targeted range so that the Fed could cut interest rates.

By Hyun-jin Kim(kimhj30310@nspna.com) and Soo-in Kang(sink606@nspna.com)

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