Bank of Korea Gov. Lee Ju-yeol on Thursday downplayed concerns about exports in its longest 14th-straight-month fall, saying the phenomenon is the result of depressed demand around the world as reflected in the rise in Korean share in global trade.

The central bank stood pat in Thursday’s monetary policy meeting, keeping the base rate steady at 1.5 percent for the ninth consecutive month to leave options open ahead of further instabilities.

Following are details of his comments during a press conference.

Q: Is there any change in economic view compared with last month?

A: There is no big difference in our view on the economy from a month ago. Downside risk has increased with exports extending losses and confidence weakening. But there are upsides with improvements in U.S. economic data and oil prices.

Q: Do you believe the current interest rate level is helpful to the economy?

A: The key rate is currently sufficiently accommodative. I don’t think it is of any constraint to the economy.

Q: What will be a solution to sluggish exports?

A: We must pursue measures to boost competitiveness with a long-term perspective.

Q: What do you think about the negative interest rate being employed by some major central banks?

A: We will have to wait and see to determine the effect from the action. But the situations in Europe or Japan are different from ours. We will however watch the changes and refer them in our monetary policy as the decisions from central banks in other countries can affect our economy and financial market.

Q: Do you think concerns over capital flight have been eased?

A: In terms of foreign investors’ equity investment for this year alone, the figure fell sharply until mid-February. Since then there has been a net flow and some central banks have begun investing in local bond market. But the conditions can change as instabilities in the international market remain.

Q: What about your view on Korea`s household debt level?

A: The levels are too high and need to be contained. We need to watch the outcome of the toughened lending guidelines.

By Lee Sang-duk

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