Bank of Korea Governor Lee Ju-yeol and Finance Minister Hong Nam-Ki told reporters that authorities were closely monitoring markets after volatility spiked in recent days in the wake of a dramatic escalation in the Sino-U.S. trade war.

When asked whether the Bank of Korea could bring forward the timing of another rate cut, Governor Lee Ju-yeol told reporters the BOK could consider doing so, but said "it is not the right time to speak about additional rate cut for now."

The BOK delivered a surprise rate cut in July as a trade row with Japan added to pressure on the economy already struggling from the broadening fallout of the Sino-U.S. trade dispute.

Washington's designation of China as a currency manipulator on Monday deepened the anxiety in markets worried about the potential flare-up of a currency war.

"(The authorities) will take pre-emptive and determined market stabilisation measures in case of any herd behaviour seen in the market," Hong said in a meeting with policymakers to discuss current financial market volatility.

Hong told reporters it is "unlikely" that South Korea will be designated a currency manipulator, adding that Washington was aware of the basis on which Seoul had conducted past currency interventions.

In early trade, the stock market's benchmark KOSPI <.KS11> index bounced in line with global peers as China took steps to stabilise a sliding yuan. The benchmark KOSPI <.KS11> stock index and the won inched up 0.1% as of 0136 GMT.

(Reporting by Joori Roh, Hayoung Choi; Editing by Sam Holmes & Shri Navaratnam)