S. Korea's central bank vows to tame inflation
2011-01-06 11:04:11
South Korea's central bank on Thursday said maintaining price stability will take center stage in its policy this year amid increasing inflationary pressure.
The Bank of Korea (BOK) will make efforts to keep the consumer price growth within its 2010-2012 median inflation target set between 2 percent to 4 percent, it said in its monetary policy report.
The bank projected a general upturn in the global economy this year despite potential risks including financial woes of the eurozone and China's liquidity management.
The domestic economy will continue to improve on the back of robust exports, the bank said, predicting local consumer price growth to hover above the target.
South Korea's consumer price growth rose to 3.5 percent in December, prompting President Lee Myung-bak to declare "war" against inflation.
The central bank raised its key interest rate in July and November to 2.5 percent from a record-low 2 percent, an attempt to fight back rising inflationary pressure stemming from the economic upturn. The benchmark interest rate this year will be adjusted in consideration of external risk factors, the bank said in the report.
The finance ministry also said in a report Thursday it will make efforts to rein in inflationary pressure stemming from rising prices of everyday essentials and raw materials.