Financial Supervisory Service Governor Lee Bok-hyun speaks at the FSS financial situation inspection meeting after the U.S. Federal Open Market Committee (FOMC) concludes on Nov. 30. /Courtesy of FSS

Lee Bok-hyun, head of the Financial Supervisory Service, noted, 'The U.S. Federal Reserve (Fed) kept interest rates steady as expected by the market, but hinted at concerns over the resurgence of inflation, stating that there is no need to rush to lower rates, which suggests that the current high rates could persist longer than expected.'

Lee held a meeting to assess the financial situation of the Financial Supervisory Service after the conclusion of the U.S. Federal Open Market Committee (FOMC) on the 30th. He analyzed, 'As economic indicators such as inflation and employment will soon be released, and the policies will have an impact, the Fed's interest rate path will be determined, potentially increasing interest rate volatility.'

The market sees a possibility that if inflation pressures increase due to the tariff and immigration policies of the Donald Trump administration, the Federal Reserve may have to raise interest rates. As President Trump has directed the U.S. Trade Representative and others to review existing trade agreements and investigate unfair practices, the report on trade practices set to be released on April 1 is expected to be a turning point.

Lee said, 'Concerns about the tariff policies of the Trump administration could add to uncertainties, which may continue throughout the first half of the year.' He further urged, 'Please do not let your guard down, and ensure thorough management of the financial situation.'

Lee instructed FSS employees to strengthen impact analysis on industries and corporations sensitive to policy changes in tariffs and subsidies of the Trump administration, assess stock market volatility and structural changes in related industries due to low-cost artificial intelligence (AI) like Deep Seek, review the actual situation of corporate financing such as loans and bond issuance, and enhance soundness management by accumulating provisions at financial firms.