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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
  • 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
  • Cryptocurrency

    Bithumb's bitcoin payout blunder results in $1.6 mil. compensation

    2 MIN READBy Lee Hyo-jin
    Bithumb's bitcoin payout blunder results in $1.6 mil. compensation
  • Economy

    S. Korean retail investors sell over $641 bil. in overseas stocks in 1st week of June

    1 MIN READBy Yonhap
    S. Korean retail investors sell over $641 bil. in overseas stocks in 1st week of June
  • Economy

    Seoul stocks, won hammered by massive foreign selling

    2 MIN READBy Park Han-sol
    Seoul stocks, won hammered by massive foreign selling
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Economy

Seoul shares spike 2.7% on expectations of slowdown in US inflation

Currency traders watch computer monitors near the screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and Korean won at a foreign exchange dealing room in Seoul, Sept. 13. APKorean stocks rallied by nearly 3 percent Tuesday as investors were optimistic ahead of the release of the U.S. inflation data, with eyes on the Federal Reserve's rate-setting policy meeting set for next week. The local currency rose against the U.S. dollar. The Korea Composite Stock Price Index (KOSPI) advanced 65.26 points, or 2.74 percent, to 2,449.54. Trading volume was moderate at 361.7 million shares worth 9.05 trillion won ($6.58 billion) with gainers far outpacing decliners 771 to 127. "We have optimistic sentiment for the U.S. August consumer price index, as the uptrend in energy prices has been limited, the expected inflation has slowed, and investors cheered over China's lower-than-expected August inflation data," Seo Jung-hun, an analyst at Samsung Securities, said."The expectation that the Fed will continue its aggressive monetary tig

Sep 13, 2022
Seoul shares spike 2.7% on expectations of slowdown in US inflation
Economy

ECB's hike, Powell's remarks within expectations but volatility likely to mount amid global tightening: BOK

Federal Reserve Board Chairman Jerome Powell speaks during a news conference in Washington, D.C., July 27. AFP-YonhapThe recent rate hike decision by the European Central Bank (ECB) and the U.S. Federal Reserve chair's remarks on monetary policy were in line with expectations but worries over aggressive monetary tightening in major countries will likely heighten volatility in financial markets, Seoul's central bank said Tuesday.From Friday to Monday, including the weekend, the Korean markets were closed due to the Chuseok holiday during which the ECB hiked its rate by 0.75 percentage point and Fed Chair Jerome Powell reaffirmed his commitment to fighting inflation, suggesting that the U.S. central bank will continue its aggressive rate increases."Those moves were broadly within expectations and volatility remains limited in price variables of major countries," the Bank of Korea (BOK) said in a press release after holding a meeting to gauge the impact of the latest financial developments."Still, the Fed responds to still high inflation and the ECB is showing signs of accelerating its

Sep 13, 2022
ECB's hike, Powell's remarks within expectations but volatility likely to mount amid global tightening: BOK
Economy

Exports down, trade deficit widens during first 10 days of Sept.

This photo shows stacks of containers at a port in Korea's southeastern city of Busan, Sept. 7. YonhapKorea's exports fell 16.6 percent on-year in the first 10 days of September due mainly to fewer working days over the Chuseok holiday, with its trade deficit widening on high energy costs, data showed Tuesday.The country's outbound shipments stood at $16.25 billion in the Sept. 1-10 period, compared with $19.48 billion a year earlier, according to the data from the Korea Customs Service.Imports also went down 10.9 percent on-year to $18.69 billion during the cited period, resulting in a trade deficit of $2.44 billion.It is larger than $1.48 billion logged the same period a year earlier.If the current trend continues, Korea is likely to post a trade deficit for the sixth straight month in September for the first time in about 25 years.The number of working days during the period came to 6.5 days, with the comparable figure for last year coming to 8.5 days.The Chuseok holiday, or the Korean fall harvest celebration, started Friday and ran through Monday this year.The daily exports, how

Sep 13, 2022
Exports down, trade deficit widens during first 10 days of Sept.
Economy

Korea seeks to introduce tighter rules to improve fiscal health

Finance Minister Choo Kyung-ho holds a briefing on the 2023 budget proposal at the government complex in Sejong, central Korea, Aug. 30. YonhapKorea's finance ministry said Tuesday it will push to introduce fiscal rules that would mandate a sharp drop in the deficit in case the national debt exceeds 60 percent of gross domestic product (GDP).The move came in line with the Yoon Suk-yeol government's push to implement a belt-tightening policy as part of effort to improve the country's financial soundness following years of expansionary fiscal spending.During the emergency economic ministers' meeting, the government decided to push for the introduction the fiscal rules, which call for capping the fiscal deficit to 3 percent of GDP, according to the finance ministry.If the debt-to-GDP ratio exceeds 60 percent, the government shall lower the deficit to 2 percent or less, it added.This year's debt-to-GDP ratio is likely to hit 49.7 percent."The introduction of the regulation that controls and manages the total amount of the budget is necessary to ensure the financial soundness," Finance Mi

Sep 13, 2022
Korea seeks to introduce tighter rules to improve fiscal health
Economy

US inflation data in focus amid growing currency volatility

An electronic signboard at a dealing room of Hana Bank in Seoul shows the Korean currency closed at 1,384.2 per dollar, Sept. 7, weakening 12.5 won from the previous close and hitting lowest level since the 2008-09 global financial crisis. YonhapBy Yi Whan-wooKorean financial markets are paying keen attention to a U.S. inflation report to be released on Tuesday (local time), as it can shape the course of the hawkish U.S. Federal Reserve's next move on the key interest rate and also add to the woes of extreme currency volatility seen here lately.The report will show U.S. consumer price data in August, whose growth is believed to have slowed down for the second straight month since July after hitting a nearly 40-year high of 9.1 percent in June, analysts said Monday.But a possible slowdown would not mean the Fed will go easy on the benchmark interest rate in its upcoming rate-setting meeting scheduled for Sept. 20 to 21, as U.S. inflation is still far from the annual target of 2 percent, according to analysts.In turn, the won-dollar exchange rate is open to keep breaking ceilings after

Sep 12, 2022By Yi Whan-woo
US inflation data in focus amid growing currency volatility
Economy

Gov't to collect data to curb housing speculation by foreigners

Apartment complexes and buildings in southern Seoul / NewsisBy Anna J. ParkThe government plans to release statistics of the real estate properties in Korea held by foreigners starting from the first quarter of next year, with the goal of curbing housing speculation by foreigners. According to the land ministry's key budget plans for next year submitted to Democratic Party of Korea lawmaker Rep. Park Sang-hyuk, 300 million won ($217,000) has been allocated to drawing up statistics on housing owned by foreign nationals over the next year. Out of the total of 17.8 billion won allocated to surveys and statistics of housing in Korea in next year's budget, 300 million won will be spent exclusively to collect data on the real estate holdings of foreign nationals. It is the first time ever that the Korean government has allocated money solely for the purpose of surveying and compiling statistics on foreigners' housing ownership in Korea. “The reason for allocating the money in the budget plan is to respond properly to foreigners' housing speculation by establishing a specified databas

Sep 12, 2022By Anna J. Park
Gov't to collect data to curb housing speculation by foreigners
Economy

INTERVIEW Korea faces challenges similar to 2008 financial crisis: Ex-Fed economist

Containers are piled up at a harbor in Korea's largest port city of Busan, Wednesday, when the won-dollar exchange rate surged above the 1,380 won-level for the first time in more than 13 years. A weakening won is blamed for a trade deficit Korea suffered for five consecutive months through August. YonhapKim says prolonged trade deficit could be perceived as sign of economic crisisThis article is the first in a series of interviews with economic experts to analyze the status of the Korean economy and make policy suggestions. ― ED.By Yi Whan-wooA noted economic expert has called on the Korean government to raise its guard against a possible economic crisis, as the Korean economy is facing challenges similar to those of the 2008-2009 global financial crisis. Kim Jin-il, a former U.S. Federal Reserve economist, pointed out that the five-month-long trade deficit Korea has suffered, which is rare, could be perceived from abroad as a sign of a possible crisis if it is protracted.Also an economics professor at Korea University, Kim assessed that Asia's fourth-largest economy is currently un

Sep 12, 2022By Yi Whan-woo
[INTERVIEW] Korea faces challenges similar to 2008 financial crisis: Ex-Fed economist
Economy

Hyundai Motor, LGES stocks shine brighter amid bearish stock market

Employees look into monitors as they work at a dealing room in Hana Bank's headquarters in central Seoul on Sept. 8. The KOSPI closed at 2,384.28 on Thursday, up 0.33 percent from the previous trading session. YonhapCompanies show strength despite weakened won and US IRABy Anna J. ParkAs the won-dollar exchange rate soared to a 13-year high recently, local stocks have generally become less attractive to foreign investors due to the weakened Korean currency. But some local stocks still remain popular among foreign investors. They have been focusing lately on buying LG Energy Solution (LGES) and Hyundai Motor. A weak won makes Korean automobiles cheaper to buy overseas, while LGES is expected to benefit from the implementation of the U.S. Inflation Reduction Act (IRA) by building a joint venture battery plant in America.According to the Korea Exchange (KRX), foreign investors were net sellers of local stocks this month, dumping 1.1 trillion won ($790 billion) worth of Korean shares since the start of the month. During their selling spree of local stocks this month, however, foreig

Sep 12, 2022By Anna J. Park
Hyundai Motor, LGES stocks shine brighter amid bearish stock market
Economy

Korean currency expected to continue to weaken after Chuseok

By Lee Min-hyungThe won-dollar exchange rate is forecast to rise further after the Chuseok holiday due to the U.S. Federal Reserve's hawkish pivot and the global energy crisis, analysts say.They added that the dollar will continue gaining ground against the Korean won in the coming weeks, due to lingering multiple external risk factors as well as another giant rate hike by the Fed later this month.The won-dollar exchange rate closed at 1,384.2 won per dollar Wednesday, up around 6 percent from a month ago. The rate ended at 1,306.4 won on Aug. 8.Market analysts said the Korean won will continue to slump until the end of this year.“The won's additional fall appears inevitable and the local currency will likely keep weakening its value against the dollar until the end of 2022 and then the exchange rate is expected to stabilize next year,” KB Securities analyst Kim Hyo-jin said.The analyst pointed out that the soaring energy prices and the Fed's reiterated hawkish gesture would keep raising the dollar's value.Kim Dae-jong, a professor of business administration at Sejong Uni

Sep 8, 2022By Lee Min-hyung
Korean currency expected to continue to weaken after Chuseok
Economy

Typhoon Hinnamnor hits Korean general insurers

Cars are flooded at a residential area in the nation's southeastern city of Pohang, Tuesday. YonhapBy Lee Min-hyungLocal non-life insurers lost tens of billions of won, as more than 6,000 vehicles here were damaged during Typhoon Hinnamnor's rampage across the southern regions of the peninsula.According to data from the industry, a total of 6,762 cars were damaged by floods as of 3 p.m. Thursday. The damage is worth 54.6 billion won ($39.6 million), according to data compiled by the General Insurance Association of Korea and the nation's 12 general insurers. But the figure is expected to rise higher, as restoration is still underway in flood-hit areas.The top four non-life insurers including Samsung Fire & Marine Insurance and Hyundai Marine & Fire Insurance have received car damage reports worth a total 40.64 billion won from customers due to the typhoon.But as the insurers signed reinsurance agreements to insure themselves in case of emergency or on natural disaster, the loss is unlikely to come as a serious risk to them, according to data from the Financial Supervisory Ser

Sep 8, 2022By Lee Min-hyung
Typhoon Hinnamnor hits Korean general insurers
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