low interest rate stance for quite some time, based upon the stability of prices. during this period, however, we have seen worsening global imbalances and sharp rises in house prices in many developed countries. we also need to watch the development of this global low inflation phenomenon further, to see whether it can be sustained in the time ahead. recently, the prices of raw materials such as oil and copper have risen sharply in line with the continuing rapid growth in emerging countries like china, and wages in these countries have also begun to rise gradually. in these respects, there is a latent possibility of the disinflationary effects of globalization we have experienced so far shifting into reverse in the future. another aspect of globalization, the integration of domestic and foreign financial markets, has led to many difficulties in the practical conduct of monetary policy. the major policy variables of concern to the central bank, including interest rates and exchange rates, are now very greatly influenced by external factors. central banks of small open economies, in particular, have seen their power to control these variables considerably weakened. they have come to recognize limitations to their capacity to conduct monetary policy on their own. in addition to this, the central bank's judgment and forecasting of the economic situation have been made more difficult, owing to the changes in the economic structure and heightened uncertainty arising from globalization. for instance, in judging the likelihood of inflation, it is now also essential to consider the global output gap, in addition to the domestic resource utilization rate. closing remarks ladies and gentlemen, apart from the benign aspects of globalization, it has also ushered in many serious challenges that our central banks now face. i look forward to this seminar providing the opportunity for productive, in - depth discussions of these important issues. i also hope that, although short, this seminar will led to establishment of a foundation for increasing policy cooperation among all our central banks, by way of the mutual friendships built up here among participants. although the schedule for the seminar is rather demanding, i close with the hope that all participants will also find the time to enjoy the beauty of korean culture, while relishing the atmosphere of this refreshing late autumn. thank you.

myun - shik yoon : opening address - bok - snu institute for research in finance and economics international conference " changing inflation dynamics " opening address by mr myun - shik yoon, senior deputy governor of the bank of korea, at the bok - snu institute for research in finance and economics international conference " changing inflation dynamics ", seoul, 3 november 2017. * * * introduction good morning, ladies and gentlemen. i am very pleased that the bank of korea and seoul national university are co - hosting this international conference today on inflation dynamics, which have recently drawn attention from academia and central banks around the world. i welcome you all most sincerely. let me express my special gratitude to professor chan wook park, vice president of seoul national university, who will deliver some welcome remarks shortly. i would also like to thank professor kiyotaki, our keynote speaker, and all of our session moderators, speakers, discussants and panelists. i am very grateful as well to professor yeongseop rhee, director of the snu institute for research in finance and economics, and his staff, for their efforts in so thoroughly preparing this conference. recent inflation conditions the global economy has been emerging recently from a long - term economic slowdown, as economic conditions in both advanced and emerging market economies are now improving. this is assessed as due in large part to the active and bold monetary policies to achieve economic recovery pursued by the world ’ s central banks, which have been often referred to as ‘ the only game in town. ’ when we look at inflation, however, we find that it has not emerged from its much reduced level seen since the global financial crisis. and there have thus been active discussions recently on the weakened linkage between economic activities and prices, and on the changes in inflation dynamics that have led to talk of so - called “ missing inflation. ” in korea as well, our economic activities continue to improve steadily, thanks to the favorable global conditions for example and despite the recent uncertainties surrounding our domestic and overseas conditions. but core inflation, which reflects our demand - side inflationary pressures, is still in the mid - 1 % range. research on the recent persistently low inflation discussions of the causes for the divergence between economic conditions and prices are developing actively these days. the most representative argument concerns a so - called phillips curve flattening, involving a weakened relationship between economic slack and inflation. specifically, it is said that the degree to which economic