This paper estimates the monetary policy reaction function in Korea after1999 when the Bank of Korea started to announce a policy interest rate underinflation targeting. In particular, we focus on a change in the monetary policyreaction function before and after the global financial crisis in terms of thereactions to inflation pressure and GDP gaps. The empirical results based onthe GMM and 2SLS estimation methods are summarized as follows. The policyrate responds with significance to GDP gaps but not to inflation pressureexpected to occur in the following 12 months, both before and after the globalfinancial crisis. This behavior appears to be consistent when the US monetarypolicy rates and/or the real exchange rate is included in the estimation. Thepolicy rate is estimated to respond more to GDP gaps during recessions thanduring expansions while there is no significant difference in the monetarypolicy reaction function between under positive inflation pressure and undernegative inflation pressure. From the estimation using various time horizonsfor estimating inflation pressure from the past 12 month period to the future 12month period, the policy rate tends to respond to the past 12 month periodand the one-month ahead inflation but not to the longer future expectedinflation, which implies that the rate decision is not preemptive.