SEOUL -- Bank of Korea (BOK) Governor Lee Seong-tae warned of an economic slowdown on Thursday, saying US financial market unease will pull down growth rates here and pour cold water on consumption and corporate investment, the Korea Times reported on Friday.
"Various indications show that economic growth may fall at a faster pace than we anticipated months ago," Lee told reporters after holding a meeting with the central bank's Monetary Policy Committee.
"My conclusion is that external risks will have a greater impact on the economy. The financial instability in the United States and other global markets will continue for the time being, negatively affecting consumption and investment here," he added.
"We forecast the rapid rises in commodity prices will push consumers to cut spending," Lee said. "Consumer prices will remain above the BOK's target range of 2.5 to 3.5 percent for the time being, but are expected to fall below 3.5 percent toward the end of this year."
Local analysts view Lee's remarks as an indication that the BOK may shift its policy focus to downside risks for the economy from inflation soon, the local daily said.
