South Korea picks IMF official as new central bank chief

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Nominee is wide expected to proceed country’s efforts to curb ostentation with assertive involvement complaint hikes.

Published On 23 Mar 2022

South Korea nominated connected Wednesday seasoned International Monetary Fund authoritative Rhee Chang-yong arsenic its caller cardinal slope chief, a prime wide expected to proceed the bank’s efforts to curb ostentation with assertive involvement complaint hikes.

Rhee, presently the manager of the Asia and Pacific Department astatine the IMF, volition articulation the Bank of Korea arsenic Asia’s fourth-largest system battles surging prices, driven by proviso concatenation snags and the Ukraine war.

He succeeds Governor Lee Ju-yeol, whose word ends March 31 aft 8 years helming the bank.

Economists accidental portion Rhee is apt to beryllium little hawkish than Lee, affecting the constitution of the bank’s seven-member board, helium is not expected to importantly change the BOK’s existent argumentation posture.

“Looking astatine his past comments and reports, helium is much of a dove, though helium won’t uncover specified a stance fixed existent economical climate,” said Kyobo Securities economist Paik Yoon-min. “But I bash deliberation that the BOK’s committee mightiness extremity up with much dovish colour.”

The BOK adjacent reviews its argumentation complaint connected April 14 and analysts expect the committee to instrumentality the basal complaint to 1.75 percent by end-2022 from 1.25 percent currently.

Kong Dong-rak astatine Daishin Securities besides said Rhee would beryllium little of a hawk than Governor Lee, though “he won’t blatantly marque that wide until aft a fewer hikes”.

The BOK has raised involvement rates 3 times since August to hose down inflationary pressures and a build-up of fiscal imbalances, making it 1 of the world’s much hawkish cardinal banks.

The slope present says adjacent much assertive complaint hikes whitethorn beryllium needed amid rising import costs and ongoing proviso concatenation hiccups.

Political transition

The alteration successful slope politician comes amid a wider governmental modulation successful the state with blimpish President-elect Yoon Suk-yeol acceptable to instrumentality bureau successful May, replacing outgoing person Moon Jae-in.

Moon’s bureau said connected Monday the president had discussed the information with Yoon, though Yoon’s modulation committee released a abstracted connection saying the information had not been addressed successful conversations.

Before commencing his four-year term, Rhee volition beryllium taxable to questions from lawmakers astir his economical expertise and ethical standards.

Members of the National Assembly often grill those tapped arsenic apical officials successful parliamentary hearings, though Rhee’s information does not formally necessitate legislative approval.

Such hearings successful the past person focused connected a wide scope of idiosyncratic matters, including nominees’ spot transactions, taxation histories and adjacent the subject work of relatives.

As a manager astatine the IMF, Rhee presently oversees its lending operations and surveillance enactment crossed Asia-Pacific.

Before joining the IMF successful 2014, Rhee served arsenic main economist astatine the Asian Development Bank and a Sherpa for the country’s G-20 Presidential Committee erstwhile South Korea hosted the group’s acme successful 2010.

He has worked intimately with concern ministry officials, including erstwhile vice concern curate Choi Sang-mok who is present a portion of President-elect Yoon’s modulation committee.

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