Bank of Korea Governor Lee Ju-yeol has hinted that this year’s economic growth could slow even further if the trade dispute with Japan worsens. 

During a briefing before the National Assembly’s Strategy and Finance Committee on Tuesday, Lee said the bank had not sufficiently reflected Japan’s export curbs in its economic growth outlook released last Thursday. He said if the situation worsens, the economy will clearly take a hit.  

Last Thursday, the central bank lowered this year’s growth outlook from two-and-a-half percent to two-point-two percent.  

On whether the bank would further slash the nation’s key interest rate this year, Lee said he could not say as the decision would depend on conditions in the real economy and developments in the international financial market.  

He was quick to add, however, that if major uncertainties emerge, including Japan excluding South Korea from its export whitelist, the bank would consider what its response should be, leaving open the possibility of a further rate reduction.