[2020 National Assembly Audit] Lee Ju-yeol Refutes Kim Hyun-mi: "Ultra-Low Interest Rates Are Not the Main Cause of Jeonse Price Increase"

Lee Ju-yeol, Governor of the Bank of Korea, is listening to questions from lawmakers at the Comprehensive Audit of the Ministry of Strategy and Finance held at the National Assembly in Yeouido, Seoul on the 23rd.
[Image source=Yonhap News]

[Asia Economy Reporter Kim Eun-byeol] Lee Ju-yeol, Governor of the Bank of Korea, stated on the 23rd that ultra-low interest rates cannot be considered the main factor behind the rise in jeonse prices.

At the comprehensive audit of the National Assembly's Planning and Finance Committee on the same day, in response to a question from Jeong Il-young, a member of the Democratic Party of Korea, asking "Do you think ultra-low interest rates are the main cause of instability in the jeonse market?" Governor Lee replied, "It may have had some influence, but it is not the main factor." He added, "The rise in jeonse prices is also affected by supply and demand conditions, the volume of supply, and the rise in sales prices at the time."

Earlier, the Ministry of Land, Infrastructure and Transport stated in a press release on the 19th that "This year, the Bank of Korea inevitably lowered the base interest rate to overcome the economic crisis caused by the novel coronavirus infection (COVID-19), and this has acted as a factor causing instability in jeonse prices."

Meanwhile, in response to Seo Byung-soo, a member of the People Power Party, who pointed out that "There could be side effects on the economy due to a housing price bubble collapse," Governor Lee replied, "I cannot categorically say that (a collapse) will not happen," and added, "I am cautious."