The chief of the Bank of Korea (BOK) said on Saturday that the Korea-U.S. currency swap deal is "not a cure-all" to stabilize the foreign exchange market.

BOK Governor Rhee Chang-yong, who is visiting the United States to attend the annual meetings of the International Monetary Fund and the World Bank Group, made the remark in a meeting with reporters.

Rhee said that the Korea-U.S. currency swap would basically bring psychological stability to South Korea and the won-dollar exchange rate will significantly fall in the beginning, but the local currency will weaken again in a few months.

Regarding the continued appreciation of the U.S. dollar, the BOK chief said that the U.S. Federal Reserve is sending a clear message that it would continue to raise its key interest rate for the time being to contain soaring prices, but it is probably considering the possible repercussions and spillback of its monetary policy.

As for the possibility of the U.S. economy slipping into a recession, Rhee said that everyone knows that the U.S. is facing a greater possibility of a hard landing than two months ago.