South Korea Bank Nominee Urges Flexible Policy Amid Middle East Tensions

SEOUL, March 31 - Shin Hyunsong, the nominee to lead South Korea's central bank, called for flexible monetary policy on Tuesday to address escalating economic risks from the ongoing conflict in the Middle East, as the Korean won weakened to its lowest level against the U.S. dollar in nearly 17 years.

Speaking to reporters in central Seoul ahead of his parliamentary confirmation hearing, Shin, who was nominated last week by President Lee Jae-myung, emphasized that the current exchange rate does not signal major concerns. The won opened at 1,519.9 per dollar that day, after closing as low as 1,517.3 the previous week, amid heightened tensions involving Iran that have driven up global oil prices. "I do not attach much significance to the won-U.S. dollar exchange rate level itself," Shin said. "What matters is whether the market can absorb related risks, and in that sense, there are no major concerns."

Shin, currently head of the economic department at the Bank for International Settlements, highlighted ample dollar liquidity in the market, attributing this to recent improvements in external vulnerabilities such as stronger foreign capital inflows and expanded use of foreign...