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  • Economy

    Expected BOK rate hike prompts concern over rising interest burdens on households, firms

    Expectations of imminent interest rate hikes by the Bank of Korea (BOK) are adding to pressure on households and businesses already struggling with rising borrowing costs, analysts said Sunday. Lending rates at major banks have continued to climb as BOK Gov. Shin Hyun-song struck a hawkish tone following a Monetary Policy Board meeting on May 28, reinforcing market expectations that the central bank could begin raising rates as early as July. According to banking industry data, fixed-rate mortgage loans offered by the country's five major lenders — KB Kookmin, Shinhan, Hana, Woori and NH NongHyup — carried interest rates ranging from 4.39 percent to 7.33 percent as of Friday. The upper end of the range was up 0.33 percentage point from a month earlier, when rates stood between 4.4 percent and 7 percent. It marked the first time since October 2022 that the highest fixed mortgage rate among the five major lenders exceeded 7.3 percent. Personal credit loan rates have also moved higher. As of Friday, interest rates on personal credit loans for top-tier borrowers with one-year maturities ra

    2 MIN READBy Lee Hyo-jin
    Expected BOK rate hike prompts concern over rising interest burdens on households, firms
  • Economy

    KRX issues circuit breaker for KOSPI on sharp fall

    1 MIN READBy Yonhap
    KRX issues circuit breaker for KOSPI on sharp fall
  • Economy

    Seoul shares open 1.38% lower on woes over inflation, tech slump

    1 MIN READBy Yonhap
    Seoul shares open 1.38% lower on woes over inflation, tech slump
  • Others

    AI-fueled Samsung affiliates reshape KOSPI market cap rankings

    2 MIN READBy Jun Ji-hye
    AI-fueled Samsung affiliates reshape KOSPI market cap rankings
  • Policy

    Top policymakers vow stern action against speculative FX market activities as won weakens

    2 MIN READBy Yonhap
    Top policymakers vow stern action against speculative FX market activities as won weakens
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CEO & Publisher: Oh Young-jinDigital News Email: webmaster@koreatimes.co.krTel: 02-724-2114Online newspaper registration No: 서울,아52844Date of registration: 2020.02.05Masthead: The Korea TimesCopyright © koreatimes.co.kr. All rights reserved.

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Economy

BOK chief makes pitch for resilience of financial markets amid heightened volatility

Bank of Korea Gov. Rhee Chang-yong attends a press conference at the central bank in Seoul on June 21. YonhapKorea does not face the same challenge of securing dollars as previous financial crises and currently maintains a "stable" foreign exchange (FX) liquidity position despite recent heightened financial market volatility, Seoul's top central banker said Saturday.Bank of Korea (BOK) Gov. Rhee Chang-yong made the remark in a speech at the Peterson Institute for International Economics, a think tank based in Washington, where he was attending annual meetings of the International Monetary Fund and the World Bank."Korea's net international investment position is 41 percent of gross domestic product as of June 2022. Considering the over $410 billion in foreign exchange reserves as of September 2022 and the relatively low short-term external debt to FX reserve ratio, FX liquidity conditions in Korea are highly stable," Rhee said. "Regarding external debt, any negative balance sheet effects from the stronger U.S. dollar are diminished by the smaller share of debt denominated in dollars a

Oct 15, 2022
BOK chief makes pitch for resilience of financial markets amid heightened volatility
Economy

Housing market hit hard by rising interest rates

By Yi Whan-wooHousing prices in Korea dipped to their lowest level in more than 10 years, data showed Friday, over a steep hike in the benchmark interest rate, which is detracting would-be homeowners from borrowing money from banks. Real estate experts forecast that housing prices have not bottomed out yet and will continue to fall through the end of 2023. They speculate that the rate hikes are likely to go on until the first half of next year and that the effects of the hikes will last for the subsequent six months thereafter.According to data from the Korea Real Estate Board, Friday, the average apartment price nationwide dropped by 0.23 percent this week, compared to a week earlier, when it declined by 0.20 percentThe 0.23-percent fall marked the steepest decline in the average price of an apartment, the major residential housing type in Korea, since May 7, 2012, when the board began to compile relevant data.By region, the greater Seoul area, where more than half of the country's population lives, also saw a record fall in the average apartment price at 0.28 percent from a week ea

Oct 14, 2022By Yi Whan-woo
Housing market hit hard by rising interest rates
Economy

Household debt poses serious threat to Korean economy amid soaring interest rates

A signboard directs customers to the personal loan service section at a commercial bank in Seoul, in this photo taken in June 2021. Korea Times fileBy Yi Whan-wooHousehold debt in Korea is posing a great threat to the economy, as it is growing at a faster pace amid more aggressive credit tightening embraced by the Bank of Korea (BOK) over the past months to tame red-hot inflation. Total household debt in Korea surged to a record 1,869.4 trillion won ($1.33 trillion) in the second quarter of 2022, up 258 trillion won from the first three months of 2020 when the nation was in the early stages of the COVID-19 pandemic.With this overall increase of 258 trillion won, the average financial imbalance of households nationwide was measured at 78.5 points in data released by Hyundai Research Institute in August.The measurement was comparable to 75.4 points during the 2008-2009 global financial crisis.The higher the number, the worse the financial imbalance, according to the institute.“The rise in the financial imbalance during the pandemic suggests that household debt is increasingly sta

Oct 14, 2022By Yi Whan-woo
Household debt poses serious threat to Korean economy amid soaring interest rates
Economy

BOK braces for financial market volatility following higher-than-expected US inflation data

Bank of Korea Gov. Rhee Chang-yong speaks during a press conference at the central bank in Seoul on Oct. 12. YonhapKorea's financial markets will likely see amplifying volatility affected by the U.S.' announcement of higher-than-anticipated inflation data in September that will strengthen the case for the Federal Reserve's sharp interest rate hikes in the coming months, Seoul's central bank said Friday."Expectations have grown that the U.S. Fed will beef up monetary tightening to cope with high inflation and accordingly uncertainty will likely increase in financial markets at home and abroad," the BOK said in a release after convening a meeting to discuss the impact of the latest U.S. consumer price data. "We will keep close tabs on changes in financial and foreign exchange markets and be ready to take action in a timely manner in case of excessively high volatility," it added. Overnight, the U.S. announced that the consumer price index in September rose 8.2 percent from a year earlier, a level higher than a market consensus, with core inflation, excluding volatile food and energy ca

Oct 14, 2022
BOK braces for financial market volatility following higher-than-expected US inflation data
Economy

Import prices up in Sept. as strong dollar sends raw material costs higher

An electronic signboard in the dealing room of Hana Bank in Seoul shows the Korean currency closed at 1,431.30 won against the U.S. dollar on Sept. 26, down 22 won from the previous session, amid mounting concerns over a global recession. YonhapKorea's import prices increased for the first time in three months in September as the strong dollar drove up the costs of buying raw materials from abroad despite recently moderating crude oil prices, central bank data showed Friday.The import price index stood at 154.38 in September, up 3.3 percent from a month earlier, according to the preliminary data from the Bank of Korea (BOK).It was the first decline in three months following on-month falls of 2.6 percent and 0.9 percent in July and August, respectively. From a year earlier, the index was up 24.1 percent.The won's fast slide against the U.S. dollar has led to an increase in the costs of importing key materials, more than offsetting the downward effect from recently moderating crude oil prices.The won has fallen by around 17 percent against the dollar so far this year. The won's descent

Oct 14, 2022
Import prices up in Sept. as strong dollar sends raw material costs higher
Economy

Korea adds 707,000 jobs on-year in September

Jobseekers participate in a session at a job fair in Seoul on Oct. 11. Yonhap Korea added jobs for the 19th straight month in September, data showed Friday, but the growth continued to slow for the fourth month in a row amid concerns over a recession.The number of employed people stood at 28.38 million last month, up 707,000 from a year earlier, according to the data compiled by Statistics Korea. It was the largest on-year growth for any September since 1999. The latest figure fell below the on-year rise of 807,000 tallied in the previous month. "The number of employed people increased in September, but the growth has slowed," a senior Statistics Korea official said. "Since there are so many uncertainties, it is hard to predict (until when the growth will continue)."The finance ministry said in a statement that the monthly job data is stable, but the growth has slowed as the economy is losing steam. The growth was mainly led by those aged 60 and above, which accoun

Oct 14, 2022
Korea adds 707,000 jobs on-year in September
Economy

Steep rate hike feared to deal further blow to borrowers

An advertisement reads, “Personal credit loans, mid-range interest rate loans for employees offered at interest rates of 4.97 to 10.27 percent annually,” at a commercial bank in Seoul, Thursday. Yonhap By Yi Whan-wooA sharper-than-expected rate hike in Korea is feared to deal a further blow to borrowers who have already been struggling with a snowballing amount of repayments. The Bank of Korea (BOK) carried out a second big-step rate hike, raising the benchmark interest rate by 50 basis points, Wednesday, sending the rate back to 3 percent for the first time since October 2012.Wednesday's big rate increase follows the one in July, and marks the fifth consecutive monetary tightening move since April, with interest payments for both individual and corporate borrowers estimated to rise by 12.2 trillion won.The increased burden in interest payments comes as household debt in Korea surged to a record 1,869.4 trillion won ($1.33 trillion) in the second quarter of this yea

Oct 13, 2022By Yi Whan-woo
Steep rate hike feared to deal further blow to borrowers
Economy

Seoul shares end lower on recession woes

An electronic signboard in the dealing room of Hana Bank in Seoul shows the benchmark Korea Composite Stock Price Index (KOSPI), Oct. 13. YonhapKorean stocks finished down Thursday amid persistent concerns that combative monetary tightening policies in major economies could drag the global economy into a recession. The local currency lost ground against the U.S. dollar.The benchmark Korea Composite Stock Price Index (KOSPI) shed 39.60 points, or 1.8 percent, to end at 2,162.87.Trading volume was moderate at 781 million shares worth 6.96 trillion won ($4.86 billion), with losers far outpacing gainers 842 to 73.Institutions offloaded a net 299.2 billion won worth of shares, while foreign and retail investors bought a net 273 billion won worth of shares.The market opened lower and extended losses as investors awaited the release of the September consumer price index, one of the key indicators that would determine the pace of the U.S. Federal Reserve's monetary policy tightening going forward.Minutes from the Fed's September meeting, out Wednesday (U.S. time), confirmed its hawkish stanc

Oct 13, 2022
Seoul shares end lower on recession woes
Economy

K bank, NH forge ties on US stock investment

K bank headquarters in Seoul / YonhapBy Lee Min-hyungK bank launched an overseas stock trading service in partnership with NH Investment & Securities, allowing its customers to buy and sell U.S. shares in the Korean currency, the mobile lender said Thursday.The service is available for K bank users who open an account with the securities firm. They can also access information on U.S. stock charts and trading trends via K bank's mobile app.One key feature of the service is that the built-in artificial intelligence (AI) program analyzes each customer's investment patterns and recommends stocks. Users can also get the latest information on stock investments and receive up-to-date news on trading.If customers open an account with the NH affiliate via the lender's mobile app by the end of this month, the bank will offer them U.S. shares worth 10,000 won ($7) for free. They can also enjoy promotional commission benefits, the lender said. Users do not have to install the securities app. They can freely trade stocks in the U.S. and Korea via K bank's app.“Under the partnership with

Oct 13, 2022By Lee Min-hyung
K bank, NH forge ties on US stock investment
Economy

Choo holds multiple meetings with world finance leaders

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho, left, shakes hands with World Bank Group President David Malpass during Choo's visit to the bank's headquarters in Washington, D.C., Wednesday (local time). Courtesy of Ministry of Economy and FinanceBy Yi Whan-wooDeputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho is holding a string of bilateral and multilateral meetings during his trip to the United States. The purpose of the trip is to attend the gathering of the finance ministers from G20 countries as well as the 2022 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group in Washington, D.C., from Wednesday to Friday (local time).The topics range from supply chain disruptions to inflation, tightened monetary policy and recessionary fears.According to the Ministry of Economy and Finance, Choo is aiming to underline the stability of Korea's fiscal health despite growing market volatility, which is being driven by economic risks from both within and outside the country.One-on-one talks ― on the sidelines of the af

Oct 13, 2022By Yi Whan-woo
Choo holds multiple meetings with world finance leaders
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