Bank of Korea(BOK) Governor Rhee Chang‑yong said that South Korea’s economy is expected to grow one‑point‑eight percent this year, a pace close to its potential, but warned that growth outside the IT sector would remain far weaker at one‑point‑four percent, highlighting an increasingly uneven recovery.

In his New Year’s address released on Friday, Rhee warned that such a “K‑shaped recovery,” marked by polarization among sectors, cannot be viewed as sustainable or complete. He stressed the need for continued structural reforms to diversify growth engines and avoid repeated cycles of sector‑concentrated expansion.

On the currency front, Rhee noted that the won‑dollar exchange rate rose into the high one‑thousand‑400‑won range late last year, keeping market concerns elevated. However, he said it would be inappropriate to compare the situation to past crises, citing South Korea’s strong external position as a net creditor.

Even so, he warned that a weaker won could intensify inflationary pressures and disadvantage domestic‑oriented firms, potentially worsening the polarization he mentioned earlier.

Rhee added that the recent exchange rate level deviates significantly from the nation’s economic fundamentals, pointing to growth and interest‑rate gaps with the United States and the so‑called “Korea discount” as key factors behind the local currency’s depreciation.