Finance minister discusses market stabilization amid rising rates, Mideast uncertainty
Finance Minister Koo Yun-cheol speaks during a meeting with financial officials at Korea Federation of Banks in Seoul, Friday. Courtesy of Ministry of Finance and Economy
Korea's finance minister on Friday discussed measures to stabilize financial markets amid growing concerns over rising interest rates and heightened volatility in global markets amid renewed tensions in the Middle East.
Finance Minister Koo Yun-cheol reviewed the latest developments in global and domestic financial markets with relevant officials, according to the Ministry of Finance and Economy.
During the meeting, the participants assessed that upward pressure on interest rates has continued due to increased government bond issuance around the globe and corporate bond sales by global artificial intelligence (AI) businesses.
The participants also pointed out that rising crude oil prices amid renewed tensions in the Middle East could increase financial market volatility, vowing to closely monitor the situation.
The government additionally vowed to protect vulnerable borrowers from rate hikes, noting that current conditions remain generally manageable but could deteriorate if interest rates rise sharply.
During the meeting, the participants also reviewed progress in reforming the tech-heavy KOSDAQ market, as the government had planned to raise the minimum market capitalization requirement for continued listing from 20 billion won ($15 million) to 30 billion won starting in January.
They decided to delay implementation of the new threshold by six months to July next year, considering the time needed for the market to recover from recent volatility.
Companies that meet certain financial requirements will also be allowed to transfer their listings from the KOSDAQ to the small businesses-focused Korea New Exchange (KONEX) without undergoing a liquidation trading period to cushion the impact of delisting.