SEOUL, July 9 (Reuters) - South Korea's central bank held interest rates steady at a record low of 2.0 percent for a fifth consecutive month in a widely expected move to support a nascent recovery in Asia's fourth-largest economy.
Following are a selection of remarks by Bank of Korea Governor Lee Seong-tae at a news conference on Thursday, translated by Reuters:
INTEREST RATES
"Given the persisting uncertainties, I believe it is appropriate to take a cautious approach to monetary policy at present.
"Based on the assessment of the current economic conditions and outlook for the second half of this year and next year, we expect our easing stance to continue for a while.
"When to unwind easing policy depends on whether the economy will follow the expected path in the second half or take a different course."
ECONOMY
"The economy has moved out of a slide due to aggressive fiscal and monetary policy measures but is not robust yet. Consumption showed mild growth, capital investment fell less and exports steadily increased on a monthly basis since February. Sentiment indices also improved. Overall, economic activities have been out of the severe shock but have yet to return to strength.
"Second-quarter economic data shows a far better-than-expected improvement but I'm not sure whether the momentum will continue in the second half. Our revised forecast for this year will be up from the previous one set in April.
"The economy will keep expanding throughout the second half of the year but the pace will be very slow."
PRICES
"When taking into account last year's price trends, consumer price growth will not likely fall further from August onwards.
"For future prices, I see little upward pressure from the demand side and foreign exchange rates. Although oil and raw material prices have rebounded, they would not put much pressure unless the world economy returns to growth immediately. Inflation is expected to stay stable well into the second half of this year and next year.
"I think the pace of growth in home-backed lending is fast. When associating it with the recent rise in home prices in some parts of Seoul and the surrounding areas, we need to keep a close watch (on property price movements)."
LIQUIDITY AND CURRENT ACCOUNT
"There has been no big change in liquidity conditions over the past month. The broader measure of money supply growth is still decelerating while narrower measures are growing fast.
"The current account will stay in surplus although the surplus will shrink over time as the bigger-than-expected surplus made in the first half has been largely driven by falling imports." (Reporting by Seo Eun-kyung; Editing by Yoo Choonsik & Jan Dahinten)