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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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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

'Korean won may dip to 1,350 level over Fed's hawkish rate hikes'

By Yi Whan-wooThe Korean currency may weaken to as low as 1,350 won against the U.S dollar in the most extreme case, analysts said Friday, after the U.S. Federal Reserve stated it is committed to more hawkish interest rate hikes to tame inflation. The Korean won opened at 1,326 per dollar on Friday, falling by 4.5 won from Thursday's close when it breached the 1,320 level again for the first time in a month.It sank to 1,326.9 per dollar during intraday trading, marking the lowest level in more than 13 years, before closing at 1,325.9.The won mainly hovered between 1,300 and mid-1,310 levels for the past two months, after it dipped below 1,300 for the first time in nearly 13 years on June 23 due to increased external economic risks.The volatility in the won-dollar exchange rate, Friday, came after the Fed's minutes of its latest rate-setting meeting in July were released.Back then, it carried out a giant step ― a rare 75 basis point increase in policy rate ― for the second consecutive month to control inflation.The minutes then showed the U.S. central bank officials saw “little

Aug 19, 2022By Yi Whan-woo
'Korean won may dip to 1,350 level over Fed's hawkish rate hikes'
Economy

Regulator to announce investor protection measures from biz takeovers in Q4

Getty Images BankSouth Korea's financial regulator said Friday it will announce a set of measures to protect retail investors from the process of business takeovers in the fourth quarter of this year."We are reviewing detailed measures by gathering opinions from private-sector experts through meetings," the Financial Services Commission (FSC) said in a press release."After holding discussions with experts, we plan to announce measures to protect ordinary investors in the middle of the fourth quarter," it added.The FSC said it has commissioned a research report on how to beef up investor protection in case of managerial changes.The financial regulator clarified the timetable after an earlier media report said the Yoon Suk-yeol government has put on the back burner its promised push to strengthen the protection of retail investors from mergers and acquisitions (M&As) between listed firms and other types of business consolidation.Measures that reportedly have been under consideration include improving rules on providing investors with the right to ask for the purchase of their stock

Aug 19, 2022
Regulator to announce investor protection measures from biz takeovers in Q4
Economy

How can Korea's taxi shortage be resolved?

A photo showing cabs parked outside a taxi company in Busan / Korea Times fileBy Kim Bo-eunThe shortage of cabs across the country continues to cause inconveniences, and the government and businesses have been struggling to come up with solutions. The dive in the number of operating taxis was driven by the COVID-19 pandemic, which prompted many drivers to leave the taxi-driving business amid a plunge in demand for ride services."Younger drivers flocked to delivery or chauffeur services, as they sought better paying jobs," Lee Hyun-ro, at the Federation of Korean Taxi Workers' Unions, said.Data from the National Joint Conference of Taxi Associations shows there were a total of 230,598 taxis registered nationwide as of June, which is down 6 percent from the number that were registered in January 2019 prior to the start of the pandemic.It was mostly drivers affiliated with taxi companies who left their jobs, compared to drivers operating with their own business licenses, the majority of which continued working. The number of drivers affiliated with taxi companies stood at 74,571 as of J

Aug 19, 2022By Kim Bo-eun
How can Korea's taxi shortage be resolved?
Economy

Korea to preemptively deal with short-term foreign debt, capital flows

,000-won banknotes at Seoul KEB Hana Bank / YonhapKorea said Friday it plans to preemptively tackle a rise in the short-term foreign debt and volatility of cross-border capital flows as heightened external economic uncertainty could pose risks to its external soundness.The government also said the pace of the Korean currency's weakness against the U.S. dollar is not steep, compared with other major currencies such as the yen and the euro."Korea's external soundness remains relatively good even in the midst of heightened global uncertainty. But the global economic slowdown, volatility in energy prices and the Federal Reserve's rate hike drives could also pose risks to the external soundness," the finance ministry said.Concerns about capital flight have increased as the Fed's aggressive rate hikes made U.S. interest rates stand higher than Korea's borrowing costs.Capital outflows are feared to further weaken the Korean currency against the dollar, putting upward pressure on inflation. The won has slid around 10 percent per dollar so far this year.To preemptively tackle risks, the gover

Aug 19, 2022
Korea to preemptively deal with short-term foreign debt, capital flows
Economy

Aviation stocks gain traction on oil price fall, travel demand recovery

Passenger planes at Incheon International Airport on May 16. YonhapBy Lee Min-hyungAviation stocks are on the path to recovery after suffering from a nightmarish fall in the second quarter, as they are widely forecast to achieve a major earnings rebound due to declining oil prices and reviving demand for travel here and abroad, analysts said.Shares of Korean Air had been on a steep decline until early July, hit hard by crude oil price hikes, at the time, caused by Russia's invasion of Ukraine. Korean Air shares were traded at 32,000 won in March, but the value plummeted to around 23,000 won in mid-July.However, the stock price of the nation's largest carrier has since gone on an upward trajectory. Korean Air shares recovered to 26,500 won as of Thursday, extending a winning streak for four consecutive trading days until Wednesday.Other airlines ― such as Asiana Airlines, Jin Air and Jeju Air ― also displayed a similar trend in their stock prices during the same period.Jin Air, one of the low-cost carriers (LCC) here, reduced its deficit in the second quarter due to the fall in oil pr

Aug 19, 2022By Lee Min-hyung
Aviation stocks gain traction on oil price fall, travel demand recovery
Economy

Household income grows at record pace amid soaring inflation

By Yi Whan-wooThe nation's average household income rose at a record pace of 12.7 percent in the second quarter, but the real or inflation-adjusted consumption expenditures of households inched up a mere 0.4 percent to mark the slowest rate in 15 months, according to Statistics Korea, Thursday. The data suggests that the increase in income is not great relative to inflation, which surged to a 24-year high of 6.3 percent in July.The average monthly income of households stood at 4.83 million won ($3,700) in the April-June period, up 12.7 percent from a year earlier and the fastest year-on-year increase since 2006, when the statistics agency began compiling related data.The agency attributed this household income increase to the massive government relief aid for pandemic-hit businesses, the recovery of the in-person service sector following the easing of limits on the size of private gatherings and multi-use facility operating hours, as well as the increase in the number of new jobs.“The relief aid was especiall

Aug 18, 2022By Yi Whan-woo
Household income grows at record pace amid soaring inflation
Cryptocurrency

Authorities to ban access to unauthorized foreign crypto exchanges

gettyimagesbankBy Anna J. ParkThe Korea Financial Intelligence Unit (KoFIU) has urged caution on the part of local clients of overseas cryptocurrency exchanges to verify whether they have been registered under the Korean financial authority. The KoFIU announced a total of 16 virtual asset service providers (VASPs) on Thursday, which had failed to register themselves with the financial authority, and are thus considered illegal business operators in Korea. The cryptocurrency exchanges include KuCoin, MEXC, Phemex, XT.com, Bitrue, ZB.com, Bitglobal, CoinW, CoinEX, AAX, ZoomEX, Poloniex, BTCEX, BTCC, DigiFinex and Pionex.The KoFIU said it had notified the investigative authority about the crypto exchanges' illegal business activities targeting Korean users by offering Korean-language services. The financial regulator added that it requested the Korea Communications Commission and the Korea Communications Standards Commission to block the firms' website access to local users to prevent their unregistered business activities in Korea. Back in July of last year, the KoFIU notified foreign-

Aug 18, 2022By Anna J. Park
Authorities to ban access to unauthorized foreign crypto exchanges
Economy

Digital assets continue to expand presence in both public, private sectors

gettyimagesbankMajor banks prepare for CBDC, while financial authorities aim to regulate the digital asset market By Anna J. ParkThere are many naysayers regarding the future of cryptocurrencies, calling them the contemporary version of the infamous speculation bubble surrounding Dutch tulips in the 17th century. Despite the presence of such pessimistic voices on digital assets, it is undeniable that central banks around the globe are researching the idea of a Central Bank Digital Currency (CBDC), with the possibility of making a fiat currency in a digital form.The Bank of Korea (BOK) has also been looking closely at the subject for the past few years and major banks in Korea have been cooperating with the central bank's CBDC pilot program.NH NongHyup Bank is one of the major local banks that have been joining the BOK's CBDC research project and the bank announced earlier this week that it has successfully completed its pilot transaction system developed in response. The bank stressed that the successful development of the pilot system has given the bank both a stable blockchain plat

Aug 18, 2022By Anna J. Park
Digital assets continue to expand presence in both public, private sectors
Economy

Will KRX gold leverage index boost gold market?

Gold bars are displayed at an office of the Korea Gold Exchange in Seoul in this file photo. YonhapBy Lee Min-hyungGold will once again regain investors' attention in the latter half of this year, as demand for safe and alternative assets other than stocks, will stay solid amid lingering inflationary woes and monetary uncertainties here and abroad, analysts say. Acting on this demand, the Korea Exchange (KRX) has decided to unveil its KRX Gold Leverage Index from Aug. 22. Investors can get twice the returns, if the gold price in the spot market increases, and vice versa, the exchange said.The exchange expects the launch of the index to meet the demand for investing in gold during this period of financial uncertainty, which has been sparked by soaring inflation and the underwhelming performance of stocks.The KRX gold market is one of the easiest ways for investors to purchase gold as an investment. Gold prices hit a new high this year of around 80,000 won per gram in early March but have since extended their volatile ups and downs due to the U.S. Fed's aggressive rate hikes. Global mo

Aug 18, 2022By Lee Min-hyung
Will KRX gold leverage index boost gold market?
Economy

S. Korea's external debt hits all-time high in Q2 amid heightened market, economic uncertainty

Getty Images KoreaSouth Korea's external debt hit an all-time high in the second quarter of this year, driven by an increase in short-term liabilities amid growing financial market volatility and economic uncertainty, central bank data showed Thursday.The country's external liabilities came to $662 billion as of end-June, up $7.9 billion from three months earlier, according to the preliminary data from the Bank of Korea (BOK).The amount was the largest ever since relevant data began to be compiled in late 1994.The rise was attributed to the government's unloading of dollars to defend the local currency and a decline in the converted value of non-dollar assets amid the strong greenback.The BOK also cited high raw material prices that increased spending for imports and high demand for dollars from local companies seeking overseas investments.In particular, the country's short-term debt that matures in a year grew $8.9 billion on-quarter to $183.8 billion as of end-June, the data showed.The ratio of short-term debt to foreign reserves rose to 41.9 percent as of end-June, up 3.7 percenta

Aug 18, 2022
S. Korea's external debt hits all-time high in Q2 amid heightened market, economic uncertainty
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