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(LEAD) BOK chief, finance minister vow to manage risk factors to fuel economic growth in 2018

All News 10:37 January 04, 2018

(ATTN: UPDATES with more comments in last 3 paras)

SEOUL, Jan. 4 (Yonhap) -- South Korea's top economic policymakers said Thursday that they will do their best to manage economic and financial risks to maintain economic growth momentum in the new year.

"Despite some downside risks at home and abroad, the South Korean economy pulled off favorable growth last year thanks to strong fiscal policies," Bank of Korea Gov. Lee Ju-yeol said in a breakfast meeting in Seoul with Finance Minister Kim Dong-yeon. "This year, we expect the economy to continue on the recovery pace, but there are still risk factors that require us to remain vigilant."

Finance Minister Kim said he will cooperate with the central bank to reach the 3 percent growth target in 2018.

"This meeting is to share our views on the economic environment and policies and risk factors and seek ways to enhance policy coordination between fiscal and monetary authorities," Kim said.

Thursday's Lee-Kim meeting was their fourth round of such policy talks since Kim's inauguration in June of last year.

Earlier, the finance ministry said Asia's fourth-largest economy is expected to grow by 3 percent this year, following last year's estimated 3.2 percent expansion. The ministry also vowed to implement economic policy aimed at boosting job creation and innovative growth, which will improve quality of life.

Backed by solid economic growth and a rise in incomes, South Korea's per capita gross domestic product (GDP) is widely forecast to surpass the landmark US$30,000 threshold in the coming months.

The two policymakers said they will take a firm stance against any excessive fluctuation in foreign exchange rates.

The Korean won has been appreciating for months amid the global trend of the weakening U.S. greenback. The local currency soared to a three-year high of 1,061.2 won against the U.S. dollar on the first trading day of the year, compared with 1,149.1 won to the greenback in late September.

"The BOK and the finance ministry adhere to the same principle on foreign currency policies," BOK Gov. Lee told reporters after the meeting. "The FX rates are determined by the market, but we will come up with strong measures against any overshooting."

Bank of Korea Gov. Lee Ju-yeol (L) and Finance Minister Kim Dong-yeon shake hands at a breakfast meeting in Seoul on Jan. 4, 2018. (Yonhap)


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