S Korea-G20 financial meeting

Choo stresses coordinated monetary, fiscal policies to address inflation

By Kang Yoon-seung

SEOUL, July 19 (Yonhap) -- South Korean Finance Minister Choo Kyung-ho emphasized the importance of coordination between monetary and fiscal policies to address the ongoing global inflation during a Group of 20 finance meeting earlier this week, his office said Wednesday.

During the two-day G20 Finance Ministers and Central Bank Governors Meeting that ended in Gandhinagar, western India, on Tuesday, Choo noted that South Korea was able to limit inflation by minimizing its expenditures while adopting tariff-rate quotas on major goods.

South Korea has been adopting tariff rate quotas on key food products, including pork and mackerel, as well as industrial products, such as naphtha, to tame inflation.

Choo said such efforts have prevented an excessive transmission of global raw material price increases into the domestic market.

On the back of such efforts, South Korea's on-year consumer price growth slowed for the fifth straight month in June, falling below 3 percent for the first time in 21 months at 2.7 percent, data showed earlier this month.

"We also welcome international cooperation aimed at bolstering the resilience of the supply chain, including the Indo-Pacific Economic Framework," Choo also said during the meeting.

Meanwhile, the Bank of Korea (BOK) kept its key interest rate unchanged at 3.5 percent last week.

It marked the fourth straight time that the central bank has stood pat following rate freezes in February, April and May. The rate freezes came after the bank delivered seven consecutive rate hikes from April 2022 to January 2023.

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