Therefore, the emphasis of future monetary policy is being placed on preventing further contraction of the real economy and on promoting structural adjustment. First, the Bank of Korea will maintain a policy stance favoring the stability of interest rates in order to encourage the recovery of the real sector, insofar as this does not conflict with sustaining foreign exchange market stability.
Seen in this context, the recent substantial reduction of market interest rates and banks’ lending rates will contribute to relieving the financial expenses of the corporate sector, and to restoring consumer and investment confidence. BIS Review 95/1998  -4-  So far this year, banks have not reduced their lending rates in keeping with the decline in market interest rates.