Seoul: Uncertainty over the path of the United States' monetary policy is expected to persist, though markets have remained broadly stable following the Federal Reserve's latest interest rate decision, a senior official of the South Korean central bank said Thursday.
According to Yonhap News Agency, on Wednesday (U.S. time), the Fed kept its benchmark interest rate unchanged at the 3.5-3.75 percent range following three successive cuts since September. This decision will continue to maintain the gap between the key rates of South Korea and the United States at up to 1.25 percentage points for the time being.
BOK Deputy Gov. Yoo Sang-dai commented on the situation while presiding over a market assessment meeting. He noted that Fed Chair Jerome Powell's press conference and the timeline for the nomination of his successor and other issues could lead to continued uncertainty over the U.S. monetary policy path. Yoo also highlighted the ongoing uncertainties regarding U.S. tariff policies, concerns over the fiscal health of major economies, and geopolitical risks, all of which necessitate vigilance and close monitoring of market developments.
During the press conference, Powell stated that the U.S. economy grew "at a solid pace last year and is coming into 2026 on a firm footing." He emphasized that the Fed is "well positioned" to adjust the policy rate based on incoming economic data. Amid U.S. President Donald Trump's growing push to exert control over the Fed, Powell defended central bank independence, describing it as a standard practice in every advanced economy and democracy worldwide.