Former Bank of Korea Governor Rhee Chang-yong said South Korea should not overreact to short-term won volatility because its external financial position has improved. In a Bloomberg TV interview in Seoul on September 9, Rhee said the country has shifted from being a net debtor to a net creditor in international markets, meaning a particular exchange-rate level should not trigger panic. The interview was his first with overseas media since leaving the BOK in April. Rhee also called for greater coordination among major economies in foreign-exchange markets, while warning that policymakers can smooth volatility but cannot reverse an exchange-rate trend without fundamental policy changes. He identified the evolution of the Iran conflict, South Korea’s expansionary fiscal policy and the U.S. election as important variables for future monetary-policy decisions. He said continuing semiconductor strength could be offset by rising South Korea-U.S. trade tensions, which could weaken growth and affect inflation in opposing directions.