In the absence of Trade Minister Kim Hyun-chong, who on the previous day left for Washington to meet with US Trade Representative Office counterparts, Deputy Trade Minister Kang Sung-chun chaired a meeting with related ministries, public organizations and businesses.

Saying the US-China trade dispute was “likely to be prolonged,” he urged related ministries to closely monitor and respond to the issue in order to stop external uncertainties from spreading to the economy here.

With the ongoing trade war, Korea will need to make a fundamental change by diversifying its export markets, fostering high-valued export products and expanding service exports, according to the deputy minister.

The government’s defensive gestures came as the central bank sent warning signals on the nation’s economy during the upcoming years.

After freezing the nation’s policy rate at 1.5 percent for eight consecutive months, the Bank of Korea revised down the economic forecast for this year to 2.9 percent, down 0.1 percentage point from its previously suggested 3 percent. The corresponding figure for next year was also inched down from 2.9 percent to 2.8 percent.

“Though our economy is expected to keep up a growth pace, it is true that uncertainty is higher than ever,” said BOK Gov. Lee Ju-yeol, referring to the US-China trade conflict.

The monetary policy chief also denied speculations that the central bank is considering a rate hike for as early as next month.

“One of the Monetary Policy Board members held a minority opinion (for a rate hike), but this should not be interpreted as an official hike signal of the board,” Lee added.

Despite mounting pressure to increase the nation’s key rate in step with the money-tightening gesture in leading countries, Seoul’s central bank has been refraining from similar moves due to the slower-than-expected economic recovery and the record amount of household debt here.

By Bae Hyun-jung and Shin Ji-hye
(tellme@heraldcorp.com)
(shinjh@heraldcorp.com)