South Korea's Lee says country cannot avoid raising interest rates
TLT•President Lee Jae Myung said South Korea must raise interest rates to narrow the gap with US rates, which are at 3.75%-4.00%; South Korea's benchmark rate is 3.00%.
1. Lee signals rate increases
Lee said South Korea had no choice but to raise interest rates, citing the gap with US rates and global monetary tightening. He described an increase as almost a foregone conclusion, while also voicing concern about household debt and default risks.
2. Central bank independence
Lee's comments came as the Bank of Korea considers further tightening after back-to-back rate hikes. The benchmark rate is set independently by the central bank, and the remarks risk raising concerns about its autonomy as policymakers deliberate on further increases.
