Bank of Korea governor Rhee Chang-Yong said the outcome of trade negotiations between the US and China will have an impact for all of Asia’s economies

Bank of Korea governor Rhee Chang-Yong said the outcome of trade negotiations between the US and China will have an impact for all of Asia’s economies

Bank of Korea Governor Rhee Chang-yong underscored the significance of the outcome of US-China trade negotiations for the entire Asian region. Speaking at a BOK event in Seoul on Monday, Rhee emphasized that the indirect impact of US tariffs on Asian economies, particularly through supply chains, is substantial [1].

The governor noted that the interconnectedness of Asian economies means that the US-China trade dynamic is crucial for the region's overall economic health. He highlighted that other Asian economies must consider the US-China element when assessing the impact of US levies. The comments reflect a broader concern among policymakers in Asia regarding the potential fallout from the ongoing trade talks between Washington and Beijing [1].

The remarks by Rhee come amid ongoing trade negotiations between South Korea and the US, with the two sides aiming to reach a "package" agreement by July 8. The governor stated that South Korean companies would likely manage reciprocal tariffs of around 10 percent but stressed that the outcome of the US-China trade talks is equally important [2].

Separately, Federal Reserve Governor Christopher Waller, who also spoke at the BOK conference, indicated that he sees room for interest rate cuts later this year. Waller expects that tariffs may temporarily boost inflation and raise unemployment, but he believes that any tariff-induced inflation will not be persistent. He supports looking through any tariff effects on near-term inflation when setting the policy rate [2].

The comments from both Rhee and Waller underscore the interconnectedness of global trade and monetary policy. As the US-China trade negotiations unfold, investors and financial professionals should closely monitor the potential economic impacts on Asia and the broader global economy.

References:
[1] https://www.bloomberg.com/news/articles/2025-06-02/bok-s-rhee-says-us-china-trade-talks-important-for-whole-of-asia
[2] https://en.yna.co.kr/view/AEN20250602004251320