South Korea’s Finance Minister and Central Bank Chief Pledge Closer Policy Coordination
Finance Minister Lee Hyoung-il and Bank of Korea Governor Shin Hyun-song agreed to deepen coordination as strong exports and investment contrast with external risks, cost pressures and interconnected financial, currency and property markets.
South Korea’s finance minister and central bank governor pledged closer policy coordination on Monday as the economy gains momentum from strong exports and investment but remains exposed to external risks and pressure on household livelihoods.
Finance Minister Lee Hyoung-il met Bank of Korea Governor Shin Hyun-song at the central bank’s Seoul headquarters. It was Lee’s first visit to the institution since taking office last week, and the talks lasted about 40 minutes.
The two policymakers assessed that growth momentum was strengthening, supported by robust export and investment indicators during the semiconductor upcycle. At the same time, they pointed to continued strains on living conditions and a difficult external environment shaped by interest-rate increases in major economies and geopolitical risks.
Lee described the central bank as an important policy partner in discussions about stability and growth. He called for the finance ministry and the Bank of Korea to communicate more closely in pursuing price stability, economic growth and financial stability.
Their discussions also covered longer-term policy priorities. Lee said the two institutions should jointly explore the internationalization of the won, digital finance, ways to raise the economy’s growth potential and measures to spread the benefits of growth more widely.
Shin said the central bank’s recent monetary policy response was expected to contain inflationary pressure on the demand side and reinforce confidence in the Korean economy. He said those effects could help stabilize the exchange rate, ease cost pressures and strengthen economic fundamentals.
The governor added that macroeconomic stability, supported by stable prices and financial markets, must work alongside government measures aimed at expanding growth potential. Together, he said, those efforts would help build a stronger foundation for sustainable growth.
The meeting highlighted the increasing overlap between fiscal, monetary and financial policy challenges. Lee and Shin noted that financial markets, foreign-exchange conditions and the property sector have become more tightly connected, raising the need for the two institutions to identify and address risks before they spread.
Their emphasis on coordination comes as policymakers weigh a mixed economic picture. Export and investment strength offer support to overall activity, particularly through semiconductors, while global rate moves, geopolitical tensions, currency volatility and domestic cost burdens continue to complicate the outlook. The agreement signals that the finance ministry and central bank intend to maintain distinct policy responsibilities while exchanging information and aligning their responses to threats to stability.