International Monetary Fund official Rhee Chang-yong has been nominated by South Korea as its new central bank chief.
He will succeed Governor Lee Ju-yeol, who has led the bank for eight years, at the end of his term on March 31st.
Rhee will leave his current role as the director of the Asia and Pacific Department at the IMF, joining the Bank of Korea at a challenging time as the country struggles with rising inflation.
Comments made earlier this year by the official suggest that he will continue the bank’s policy of aggressively hiking interest rates to combat the issues faced by Asia’s fourth-largest economy, although analysts do believe he will be slightly less hawkish than his predecessor.
“Continuous growth in (national and household) debt ratios due to growing liquidity could significantly affect financial markets in the future,” Rhee said in a January interview. “Korea needs to adjust the debt ratios through interest rate increases although it is difficult”.
The bank will next review its policy rate on April 14th, with analysts predicting the board will take the base rate to 1.75% before the end of the year. The current rate is 1.25%.
IMF Managing Director Kristalina Georgieva paid tribute to the outgoing official, praising the impact he had during his time at the institution.
“Chang-yong’s great strength is in seeing both sides of an issue,” Georgieva said in a statement. “At the same time, he has driven consensus on policy priorities, earning him tremendous respect and admiration throughout the Fund and across policymakers from the region”.
Prior to commencing his tenure, Rhee will be subjected to questions from members of the National Assembly, a formality that doesn’t impact on his nomination. His appointment comes in the midst of political change in South Korea, with President-elect Yoon Suk-yeol set to replace current leader Moon Jae-in in May.