It is expected that the Bank of Korea will open a provisional financial currency committee on the 17th to 18th to respond to Corona 19 and cut the standard rate.

This is because financial markets and the real economy have deteriorated rapidly, and in order to maximize the effect of interest rate cuts, it is necessary to make the most of financial stimulus measures and policy coordination.

According to the Bank of Korea, after the discussions on the agenda at the regular meeting of the KFTC held on the 12th, the members of the KFTC debated the necessity and timing of the provisional KFTC.

This is because the financial market volatility has risen and the real economy has contracted rapidly since the KFTC froze the base rate to 1.25% a year on the 27th of last month.

During this period, Corona 19 turned into a pandemic (global pandemic) phase, and the international financial market suffered the biggest shock after the 2008 financial crisis due to the economic recession.

The Federal Reserve (Fed, Federal Reserve) cut the interest rate by 0.5 percentage points from 1.00 to 1.25% per annum on the 3rd, and central banks in other major countries, such as the Bank of England (BOE), also participated in the rate cut.

Recognizing the fact that the Bank of Korea is negotiating to hold a temporary gold commission, the mayor is accepting a cut in interest rates through a temporary meeting this week.

Experts expect Han Eun to hold an ad hoc meeting during the week, when the National Assembly plans to process additional additional budgets to maximize interest rate cuts.

Considering that the main assembly of Chugyeongan National Assembly is scheduled for 17 days, the date of the temporary meeting is 17-18 days.

It is necessary to show that the financial and monetary authorities are actively engaged in 'stimulus measures' in order to subdue the fear sentiment prevalent in the economic actors after the World Health Organization's declaration of the pandemic.

Earlier in the meeting, Governor Lee Joo-yeol emphasized the importance of policy coordination, saying, “There is a limit to resolving the impact of corona 19 through monetary policy alone, so we must consider harmony with government policy in this process.”

In addition to Ministers of Economic Affairs and Minister of Foreign Affairs, Lee Joo-yeol attended a special inspection meeting held at the Blue House under the presidency of President Moon Jae-in.

At the meeting, Moon emphasized, "It is an emergency economy that cannot be compared to MERS and SARS."

The fact that the Fed's base rate decision is scheduled on the 17th to 18th is also a factor that cannot delay the temporary meeting.

The market also expects the Fed to cut its benchmark interest rate by at least 0.75 percentage points at this month's meeting.

(Photo = Yonhap News)