Ahead of the interest rate decision, the IMF recommends a cut, and what is the BOK's choice?

[Anchor]
Ahead of the Bank of Korea's key rate decision this Thursday (28th), the recent surge in the won-dollar exchange rate has emerged as the biggest variable.

In the meantime, as the IMF and the International Monetary Fund recommend Korea to gradually cut interest rates, saying exchange rate volatility is not a big risk, interest is growing in what choice the Bank of Korea will make.

Reporter Ryu Hwan-hong reports.

[Reporter]
The head of the IMF's Korean mission, who visited Korea for annual consultations with the Korean government, said in a press conference that he does not think the won-dollar exchange rate, which has risen more than 1,410 won recently, is a big risk to the Korean economy and that Korea has enough capacity to respond to currency volatility.

[Raul Anand / IMF Korea Mission Director: We don't think exchange rate volatility is any macro-financial challenge for Korea. Because we don't believe there are risks related to financial stability or prices due to that volatility.

The IMF then recommended the Korean monetary authority to gradually cut interest rates, which has made the Bank of Korea nervous at the Monetary Policy Committee on the 28th, considering whether to cut rates at the exchange rate, which has soared since the U.S. presidential election.

The Bank of Korea, which decided to cut interest rates last month and said it would adjust its pace in the future, is agonizing over whether additional rate cuts will encourage the exchange rate to rise.

Some experts say that interest rates should be cut immediately on the 28th according to the IMF's recommendation.

[Juwon / Head of Economic Research at Hyundai Research Institute: If you lower interest rates to revive some domestic sentiment of consumption and investment and make domestic demand healthy, the exchange rate may stabilize again.]

However, some experts say that the rate cut should be handed over to next year, saying that "gradual" is important.

[Huh Joon-young / Professor of economics at Sogang University] The rate cut will be slow in the U.S. next year, but it will go down. Then, I think Korea should lower interest rates to boost domestic demand and boost the economy..]

Attention is focusing on the 28th of how Lee Chang-yong, the governor of the Bank of Korea, who served as the IMF's Asia-Pacific director in the past, will reflect the IMF's opinion.

I'm YTN's Ryu Hwan Hong.