One member of the central bank’s monetary policy committee opposed a majority decision last month to hold the policy rate steady at a record low of 1.75 percent, its May minutes showed Tuesday.
As widely expected, the Bank of Korea (BOK) left the key rate on hold after unexpectedly slashing it by a quarter percentage point in March. The move marked its third rate cut in the past year, following one cut in August and another in October.
According to the minutes from the May 15 meeting, Ha Sung-keun, one of the seven members on the policy board led by BOK Gov. Lee Ju-yeol, voted to further lower the seven-day repo rate by a quarter percentage point.
“There are weak signs of improvement in domestic demand, but the trend of falling exports and imports is emerging as a considerable downside risk in the course of growth going forward,” Ha said.
He also noted the need to counter the won’s appreciation with monetary policies, stressing that “the volatility of global market rates and foreign exchange rates is likely to rise in tandem with growing anticipation that the U.S. Federal Reserve will hike rates.”
It marks the second straight month in which Ha has dissented from the majority decision. In April, however, Ha did not specify the scope of the rate cut.
He was nominated to the post by the Financial Services Commission, the state financial regulator, in 2012 and has been noted for his dovish stance, solely voting for a rate cut in previous meetings.
Details of the monthly rate-setting meeting are disclosed via the minutes released roughly three weeks after the meeting. The identities of the members who commented and their voting directions are kept anonymous unless they dissent from the majority decision.
The policy committee is set to hold its next rate-setting meeting on June 11. (Yonhap)
