{
  "title": "Republic of Korea: Selected Issues",
  "publication": "IMF Staff Country Reports, May 13, 2019",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891",
  "canonical": "https://www.imf.org/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891",
  "overlayPath": "/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/index.md",
  "summary": "This Selected Issues paper analyzes monetary policy and financial cycles; the evolution of macroprudential policies in Korea; the efficacy in prudential policies in taming financial excess and building financial resilience and; the interaction between monetary policy and macroprudential policies.",
  "sections": [
    {
      "heading": "Overview",
      "content": "- Publication date: May 13, 2019\n- Type: IMF Staff Country Report (Country Report No. 2019/133)\n- Pages: 76\n- Volume: 2019\n- Issue: 133\n- DOI: https://doi.org/10.5089/9781498314824.002\n- Stock No: 1KOREA2019002\n- ISBN: 9781498314824\n- ISSN: 1934-7685\n- Subjects: Economic sectors; Employment; Financial sector policy and analysis; Labor; Labor markets; Macroprudential policy; Manufacturing; Output gap; Production\n- Keywords: CR; Employment; EU limit; financial condition; Global; ISCR; labor market slack; Labor markets; Macroprudential policy; Manufacturing; opt-out agreement; opt-out option; Output gap; tail risk financial condition outcome"
    },
    {
      "heading": "Major findings on monetary policy and macroprudential interaction",
      "content": "- The paper analyzes: monetary policy and financial cycles; the evolution of macroprudential policies in Korea; the efficacy of prudential policies in taming financial excess and building financial resilience; and the interaction between monetary policy and macroprudential policies.\n- Evidence for Korea suggests that financial stability will not necessarily materialize as a natural by-product of a so-called appropriate monetary policy stance.\n- Although the effects of monetary and macroprudential instruments may overlap, they are not perfect substitutes.\n- Macroprudential policies can impact the banking system by affecting bank funding costs through the net interest margin.\n- In certain circumstances borrower-based prudential measures and monetary policy can complement one another.\n- Macroprudential policies can impact banks profitability.\n- Policymakers should be mindful that macroprudential policy is not free of costs and that there may be trade-offs between the stability and the efficiency of financial systems."
    },
    {
      "heading": "Policy implications and recommendations (as presented)",
      "content": "- Recognize that monetary policy alone may not achieve financial stability; targeted macroprudential measures are necessary.\n- Consider the overlapping but non-identical effects of monetary and macroprudential instruments when designing policy mixes.\n- Account for the impact of macroprudential measures on bank funding costs and net interest margins when assessing banking sector resilience and profitability.\n- Where appropriate, deploy borrower-based prudential measures in coordination with monetary policy to achieve complementary effects.\n- Weigh trade-offs between financial stability and financial system efficiency when implementing macroprudential policies.\n\nInternational Monetary Fund. Republic of Korea: Selected Issues (IMF Staff Country Reports 2019, 133).\n\n---\n\n Content in this bundle\n\n- Republic of Korea: Selected Issues; IMF Country Report No. 19/133; April 22, 2019\n  - Republic of Korea: Selected Issues; IMF Country Report No. 19/133; April 22, 2019 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Republic of Korea: Selected Issues; IMF Country Report No. 19/133; April 22, 2019 (PDF){rel=\"external\" type=\"application/pdf\"}"
    }
  ],
  "bullets": [
    "[Markdown version](/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/index.md)",
    "[Structured JSON version](/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/index.json)",
    "[Bundle manifest](/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/bundle-manifest.json)",
    "Published: May 13, 2019",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781498314824.002",
    "Publication date: May 13, 2019",
    "Type: IMF Staff Country Report (Country Report No. 2019/133)",
    "Pages: 76",
    "Volume: 2019",
    "Issue: 133",
    "DOI: https://doi.org/10.5089/9781498314824.002",
    "Stock No: 1KOREA2019002",
    "ISBN: 9781498314824",
    "ISSN: 1934-7685",
    "Subjects: Economic sectors; Employment; Financial sector policy and analysis; Labor; Labor markets; Macroprudential policy; Manufacturing; Output gap; Production",
    "Keywords: CR; Employment; EU limit; financial condition; Global; ISCR; labor market slack; Labor markets; Macroprudential policy; Manufacturing; opt-out agreement; opt-out option; Output gap; tail risk financial condition outcome",
    "The paper analyzes: monetary policy and financial cycles; the evolution of macroprudential policies in Korea; the efficacy of prudential policies in taming financial excess and building financial resilience; and the interaction between monetary policy and macroprudential policies.",
    "Evidence for Korea suggests that financial stability will not necessarily materialize as a natural by-product of a so-called appropriate monetary policy stance.",
    "Although the effects of monetary and macroprudential instruments may overlap, they are not perfect substitutes.",
    "Macroprudential policies can impact the banking system by affecting bank funding costs through the net interest margin.",
    "In certain circumstances borrower-based prudential measures and monetary policy can complement one another.",
    "Macroprudential policies can impact banks profitability.",
    "Policymakers should be mindful that macroprudential policy is not free of costs and that there may be trade-offs between the stability and the efficiency of financial systems.",
    "Recognize that monetary policy alone may not achieve financial stability; targeted macroprudential measures are necessary.",
    "Consider the overlapping but non-identical effects of monetary and macroprudential instruments when designing policy mixes.",
    "Account for the impact of macroprudential measures on bank funding costs and net interest margins when assessing banking sector resilience and profitability.",
    "Where appropriate, deploy borrower-based prudential measures in coordination with monetary policy to achieve complementary effects.",
    "Weigh trade-offs between financial stability and financial system efficiency when implementing macroprudential policies.",
    "**Republic of Korea: Selected Issues; IMF Country Report No. 19/133; April 22, 2019**"
  ],
  "related": [
    {
      "title": "Republic of Korea: Selected Issues; IMF Country Report No. 19/133; April 22, 2019",
      "role": "document",
      "sourceUrl": "https://www.imf.org/-/media/files/publications/cr/2019/1korea2019002.pdf",
      "summary": {
        "path": "/-/media/files/publications/cr/2019/1korea2019002.pdf.md",
        "mime": "text/markdown"
      },
      "binary": {
        "path": "/-/media/files/publications/cr/2019/1korea2019002.pdf",
        "mime": "application/pdf"
      }
    }
  ],
  "alternates": {
    "markdown": "/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/index.md",
    "json": "/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/index.json",
    "bundleManifest": "/en/publications/cr/issues/2019/05/13/republic-of-korea-selected-issues-46891/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-13T00:05:38.561Z"
}