BOK CHIEF ON RAISING KEY INTEREST RATE

[Anchor Lead]

For the first time the Bank of Korea chief has insinuated at the possibility of raising the key interest rate this year. His remarks apparently refer to the record-high household debt and overheated asset market.

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The BOK's Monetary Policy Board chose to freeze the key rate for now. The rate was cut to 0.75 percent in March last year and fell to 0.5 percent two months later. It's been at the lowest level for a year now.

[Soundbite] Lee Ju-yeol(Governor, Bank of Korea) : "We believe we should keep monitoring the COVID-19 situation, vaccinations, as well as the speed and steadiness of the economic recovery."

However, the nation's central banker sounded different when asked if the key rate would remain low. Lee Ju-yeol said the current accommodative monetary policies will remain in place "for the time being." This means the key rate could be raised within this year. It's quite unprecedented for the BOK governor to refrain from public comments on interest rate adjustment.

[Soundbite] "We are making thorough preparations when it comes to raising the key rate. Our Monetary Policy Board is also discussing the matter. Whether or not the key rate will be raised within this year depends on the economic situation."

Pundits say Lee's remarks apparently take into account concerns about the snowballing household debt, which has surpassed 1700 trillion won, as well as the rising value of real estate, stocks and cryptocurrencies. Regarding the rapidly growing cryptocurrency market, the Bank of Korea chief pointed out that excessive investment through loans could jeopardize household finances and financial institutions.