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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

Korean economy faces heightened downside risks: KDI

Getty Images BankThe Korean economy faces increased downside risks due to high inflation and worsening external economic conditions, a state-run think tank said Sunday.Asia's fourth-largest economy is on a mild recovery track, but downside risks are expanding in the manufacturing industry due largely to economic slowdowns in the U.S. and China, the Korea Development Institute (KDI) said in a monthly economic assessment report."External conditions have deteriorated as China's economic growth slowed significantly and the U.S. economy posted quarterly contraction. The spillover effect of rate hikes is weighing heavily on overall economic activity," the report said.Concerns about stagflation, a mix of slowing growth and high inflation, have mounted due to heightened economic uncertainty from the protracted war between Russia and Ukraine and the Federal Reserve's aggressive rate hikes.Korea's exports rose 9.4 percent on-year in July, extending their gains to the 21st consecutive month. But the country suffered a trade deficit for the fourth straight month over high global energy prices.Th

Aug 7, 2022
Korean economy faces heightened downside risks: KDI
Economy

1 out of 8 mid-aged people borrowed money to tide over pandemic: survey

Protestors chant slogans in Seoul, Feb. 15, as representatives from a national coalition of self-employed workers stage a rally to call for the lifting of the government's restrictions on their business hours and compensation for losses faced by the industry due to the coronavirus pandemic. Korea Times fileAbout one out of eight mid-aged people in Korea has borrowed money due to economic challenges caused by the coronavirus pandemic, a survey showed Sunday.According to the survey of 3,923 people by the Korea Institute for Health and Social Affairs, 12.5 percent of people in their 40s and 11.5 percent of those in their 50s said that they have taken out loans or borrowed from their acquaintances at least once due to economic challenges during the pandemic. The figure was much higher than 3.5 percent and 7.7 percent who said so among those aged 20 or younger and those in their 30s, respectively. It was also higher than the corresponding ratio of 8.5 percent for all the people surveyed. Of those polled, 8.4 percent said that they have closed savings accounts or canceled insurance policy

Aug 7, 2022
1 out of 8 mid-aged people borrowed money to tide over pandemic: survey
Economy

Companies struggle to secure female board members

gettyimagesbankBy Anna J. ParkThe country's capital market act revision that requires the mandatory appointment of a female member on corporate boards came into effect on Friday. The revision was first enforced as a law in August 2020, but it had a two-year grace period before going into effect. The statute prohibits the single-gendered formation of a company's board, when the company's entire asset size exceeds two trillion won ($1.5 billion). As many large-sized companies' board members are mostly male-dominated, corporations are now in urgent need of searching for competent female board members.According to data by Korea ESG Research Institute, some 81 percent of companies are subject to the revision as of the end of April this year. Yet, 31 companies out of the subjected 167 firms have yet to secure a spot for female board members, including container transportation firm Hyundai Merchant Marine (HMM), energy generating and solution firm Doosan Enerbility, construction and engineering firm Doosan Bobcat and leading aviation firm Korea Aerospace Industries (KAI). As seen in the afo

Aug 5, 2022By Anna J. Park
Companies struggle to secure female board members
Economy

S. Korea logs current account surplus for 2nd month; surplus shrinks amid mounting import costs

Containers for export are stacked at a pier in South Korea's largest port city of Busan, Monday.South Korea posted a current account surplus for the second straight month in June, but its amount sharply contracted from a year earlier amid mounting import costs emanating from high energy and commodity prices, central bank data showed Friday.The country's current account surplus stood at $5.61 billion in June, accelerating from the previous month's surplus of $3.86 billion, according to the preliminary data from the Bank of Korea (BOK).It marked the second straight month of a surplus following April when South Korea registered a deficit of $80 million ― the first shortfall since April 2020 ― due in part to such one-off factors as expanded overseas dividend payments.In the January-June period, the country's cumulative current account surplus came to $24.78 billion, sharply down from $41.76 billion a year earlier, though it topped the BOK's first-half projection of $21 billion.The June surplus was much smaller than the same month a year earlier when the country logged a surplus of $8.83

Aug 5, 2022
S. Korea logs current account surplus for 2nd month; surplus shrinks amid mounting import costs
Economy

Yoon gov't urged to allow conglomerates to enter biz sectors designated for SMEs

gettyimagesbankProtective policy for SMEs did not lead to enhanced competitiveness: KDI reportBy Yi Whan-wooThe Yoon Suk-yeol administration is being urged to scrap a longstanding, over-decade-old policy aimed at holding back conglomerates from entering businesses designated exclusively for small and medium-sized enterprises (SMEs), by a state-run think tank in a recent report. Introduced in 2011, the policy was intended to protect SMEs from larger businesses and help them enhance their competiveness.Conglomerates are barred from entering the aforementioned sectors for up to six years after they are designated. The sectors have varied from kimchi making to tofu processing, designated driver services and ready-mixed concrete manufacturing.Released by the Korea Development Institute (KDI), the report said that the policy turned out to have less of an effect on bolstering the competitiveness of the targeted SMEs.The overall value of the SME-only markets grew 46 percent to 57.5 trillion won ($43.8 billion) between 2008 and 2018, compared to the 52-percent growth of markets where con

Aug 4, 2022By Yi Whan-woo
Yoon gov't urged to allow conglomerates to enter biz sectors designated for SMEs
Economy

Korea to unveil inflation-combating measures ahead of Chuseok holiday

A shopper shops at a supermarket in Daegu, Tuesday. YonhapKorea plans to roll out additional measures to tame inflation ahead of the Chuseok fall harvest holiday set for September, government officials said Thursday.The finance ministry is considering ways to increase the supply of key foodstuff and reduce living costs in the run-up to the extended Chuseok holiday scheduled for Sept. 9-12.The government is also mulling providing special financial support to small firms and merchants in a bid to help them meet cash demand.The move comes as the country's consumer prices soared 6.3 percent on-year in July, the fastest rise in almost 24 years and accelerating from a 6 percent spike in June.Demand for vegetables, eggs and other foodstuff usually rises in Korea ahead of the Lunar New Year and Chuseok holidays as people prepare holiday meals for family gatherings.Prices of farm products shot up last month due largely to frequent rains and heat waves. Prices of vegetables jumped 25.9 percent on-year in July.Finance Minister Choo Kyung-ho earlier said inflation may peak no later than in Octob

Aug 4, 2022
Korea to unveil inflation-combating measures ahead of Chuseok holiday
Economy

Discarded currency down 14.1% in H1 amid increase in non-cash payments

Damaged bills / Courtesy of the Bank of KoreaThe amount of bills and coins discarded due to severe damage shrank 14.1 percent on-year in the first half amid increased prevalence of non-cash transactions, data showed Thursday.A total of 191.66 million damaged bills and coins were discarded in the January-June period, compared with 223.10 million tallied in the same period a year earlier, according to the data from the Bank of Korea (BOK).The decline stemmed from less use of cash in transactions and increased dependence on credit cards and other non-cash methods. Cash has been less used during the pandemic as people tend to prefer non-contact services at home.The central bank disposed of 169.43 million bills in the first half, with 10,000-won ($7.60) bills accounting for 54.9 percent. About 22.23 million coins were destroyed due to damage in the same period with 10-won coins making up 42.9 percent, the data showed. The face value of the discarded money last year came to 1.16 trillion won, with destroyed bills worth 1.15 trillion won and coins valued at 2.5 billion won, the data showed.

Aug 4, 2022
Discarded currency down 14.1% in H1 amid increase in non-cash payments
Economy

Pelosi's Taiwan visit pushes Korean confectionery shares to soar

gettyimagesbankBy Yoon Ja-youngU.S. House Speaker Nancy Pelosi's visit to Taiwan is having an unexpected positive effect on Korean confectionary companies. Their stock prices rose steeply on Wednesday on reports that China banned importation of Taiwanese food items on the eve of the contentious visit.Crownhaitai Holdings, a major player in the country's confectionery industry, closed at 8,470 won on Wednesday, rising 18 percent from the previous day. Crown Confectionery closed at 11,150 won, soaring as much as the daily limit of 30 percent. Haitai Confectionery and Foods rose 14 percent to 8,000 won. Orion, whose Choco Pie products are popular in the global market, rose 2.7 percent to 102,000 won. The surge comes amid expectations among some investors that Korean confectionery products, especially those of Crownhaitai Group subsidiaries, may replace Taiwanese products in the Chinese market. In the case of Orion, exports to China already account for over 40 percent of its total sales, while they account for less than 10 percent for Crownhaitai.According to Taipei Times, China's custom

Aug 4, 2022By Yoon Ja-young
Pelosi's Taiwan visit pushes Korean confectionery shares to soar
Economy

Gen MZ financial relief programs stir up fairness debate

President Yoon Suk-yeol looks at a book he received as a present during a meeting with civil servants in their 20s and 30s at Government Complex Sejong, May 26. Korea Times fileBy Yi Whan-wooFinancial relief programs for those in their 20s and 30s who struggle with loan repayments have stirred up debates about equity and fairness among older people, who also have trouble paying off loans but are excluded from receiving the financial benefits due to their age. The programs are run by the government and private banks, in line with President Yoon Suk-yeol's push to support members of Generation MZ ― a Korean term referring to Millennials and Generation Z ― who borrowed money mostly to buy homes or to invest in assets such as stocks and cryptocurrencies.Many of the targeted borrowers are facing snowballing debt, as repayment amounts have been increasing due to hikes in the benchmark interest rate, while they fail to reap profits over falling housing, stock and cryptocurrency prices.Some 56.7 percent of Generation MZ have relied on bank loans to buy homes, compared to 36.4 percent of olde

Aug 3, 2022By Yi Whan-woo
Gen MZ financial relief programs stir up fairness debate
Economy

Foreign reserves grow for 1st time in 5 months in July

A Korea Exchange Bank official counts U.S. dollars at the lender's main office in downtown Seoul, March 31, 2015. Korea's foreign reserves increased for the first time in five months in July. YonhapKorea's foreign reserves increased for the first time in five months in July, thanks to increased operation profits and expanded deposits in foreign currency, central bank data showed Wednesday.The country's foreign reserves came to $438.61 billion as of end-July, up $330 million from the previous month, according to the data provided by the Bank of Korea (BOK).Foreign reserves consist of securities and deposits denominated in overseas currencies, International Monetary Fund reserve positions, special drawing rights and gold bullion.July's increase came after foreign reserves shrank in the previous four months. It also came in contrast with the previous month when the reserves dropped by the largest amount in more than 13 years as foreign exchange authorities unloaded dollars to help stem the local currency's decline.The BOK attributed the July growth to increased profits from operation of

Aug 3, 2022
Foreign reserves grow for 1st time in 5 months in July
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