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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

Soaring housing prices pull down birth rate: study

gettyimagesbankBy Yoon Ja-youngAs the nation's total population decreased for the first time last year, with the birthrate falling to the world's lowest, a study showed that soaring housing prices are one of the main reasons. According to a study by Kang Dong-ik and Song Kyung-ho, both researchers at the Korea Institute of Public Finance, a 100 percent hike in housing prices slashes the number of kids each household has by 0.1 to 0.3 for the next 8 years.Korea's fertility rate, or the number of babies born per woman, fell to 0.81 last year, which is the lowest among the Organization for Economic Cooperation and Development (OECD) member countries. The research was done by surveying workers at state-run enterprises, which are known to offer stable jobs. For those who don't own houses, the number of children they give birth to for the next eight years decreased by between 0.15 and 0.45. That means the higher the price of housing, the less likely couples are to have a child. The study also shows that the ownership of a house has an even greater impact on childbirth.Housing prices also a

Jul 29, 2022By Yoon Ja-young
Soaring housing prices pull down birth rate: study
Economy

Korea to crack down on illegal short-selling practices

President Yoon Suk-yeol speaks during a ministerial meeting on economy held at the Healthcare Innovation Park at Seoul National University Bundang Hospital in Seongnam, Gyeonggi Province, Wednesday. YonhapSupervision and investigation of suspicious short-selling practices to be strengthened By Anna J. ParkThe government will strengthen supervision over short-selling trades that breach the law as well as unfair trade practices related to the practice. There have been growing calls from retail investors to ban short-selling, while several securities firms were found to have violated related rules.President Yoon Suk-yeol strongly urged financial authorities and prosecutors to draw up measures in order to eradicate wrongful acts surrounding short-selling and stock market manipulation. According to the presidential office on Thursday, Yoon delivered those instructions on Wednesday afternoon.“With a determination to stamp out illegal practices of short-selling without fail, related ministries, including financial authorities and the prosecution, need to come up with measures on the m

Jul 28, 2022By Anna J. Park
Korea to crack down on illegal short-selling practices
  • Korea Investment fined for improper short-selling
Economy

BOK unlikely to take another 'big step' in August

Stocks, cryptocurrencies rise as US hints at slowdown in rate hikesBy Lee Min-hyungThe Bank of Korea (BOK) is unlikely to make another “big-step” rate hike of 50 basis points during its next rate-setting meeting in August, as fears of an economic slowdown here will deepen in the latter half of the year, experts said Thursday.They expected the Korean central bank not to take risks with another aggressive rate hike as a reaction to the U.S. Federal Reserve's recent giant step, as the Korean economy will lose momentum for growth gradually from the third quarter despite lingering inflationary fears.“There stands a slim chance that the BOK will take another big step next month, as Korea's GDP growth will slow down in the third quarter due to sluggish exports and unfavorable external conditions,” Korea Capital Market Institute economist Kang Hyun-ju said.The remark came a day after the Fed increased its key rate by 75 basis points to 2.5 percent. The decision pushed the U.S. interest rate above the BOK's 2.25 percent.BOK Governor Rhee Chang-yong also underscored the

Jul 28, 2022By Lee Min-hyung
BOK unlikely to take another 'big step' in August
  • Fed unleashes another big rate hike in bid to curb inflation
Economy

Fed's rate hike to have limited impact on Korean market: finance minister

Finance minister Choo Kyung-ho / YonhapKorea's finance minister said Thursday the U.S. Federal Reserve's latest rate hike is expected to have a limited impact on the domestic financial market as the outcome is in line with market expectations.Finance Minister Choo Kyung-ho made the remarks during his meeting with the central bank chief and heads of the country's financial regulators to discuss the fallout of the Fed's "giant step" rate increase on the market and economic situations.At a two-day policy meeting that ended Wednesday (U.S. time), the Fed hiked the federal funds rate by 75 basis points for the second straight month to curb high inflation. The move raised its key rate to a target range of 2.25-2.5 percent.The decision pushed the U.S. interest rates above Korea's benchmark interest rates for the first time since February 2020. Korea's base rate stands at 2.25 percent."The Fed's decision well matched market expectations. As global financial markets well digested the Fed's rate hike overnight, it is expected to have a limited impact on the Korean market," Choo said.U.S. stock

Jul 28, 2022
Fed's rate hike to have limited impact on Korean market: finance minister
  • Fed unleashes another big rate hike in bid to curb inflation
Economy

INTERVIEW Geopolitical risk burdens S. Korea's credit profile: Moody's

This article is the second in a three-part series of interviews with chief economists covering the Korean economy for the Big Three credit rating agencies to analyze the state of Asia's fourth-largest economy amid rising interest rates and high inflation. _ ED.Top credit rating agency asks Seoul to specify 'well-defined path toward peace settlement' with Pyongyang By Kim Yoo-chulAs Washington and Seoul are preparing for expanded summertime joint military drills, Pyongyang is ratcheting up tensions by claiming that the two allies could face “undesirable consequences” if they don't stop their “military confrontation.”In a recent media briefing, White House National Security Council (NSC) spokesperson John Kirby told reporters that Washington has been very clear that North Korea could be ready to conduct a nuclear test. “I won't speculate about the timing here, or what that can look like. We are obviously going to watch this very, very closely for any possibility of a nuclear test,” Kirby said.It was in September 2017, at its Punggye-ri test site

Jul 28, 2022By Kim Yoo-chul
[INTERVIEW] Geopolitical risk burdens S. Korea's credit profile: Moody's
Economy

Tax agency reveals luxurious life of alleged tax evaders

gettyimagesbankBy Yoon Ja-youngPurchasing a number of super cars including Lamborghini and Bentley, enjoying luxurious trips overseas and buying up real estate, these are examples of what suspects of tax evasion have done with the money they hid from the tax agency. The National Tax Service (NTS) said Wednesday that it will investigate 99 people suspected of tax evasion. This time the probes are focused on those hindering fair trade and increasing the burden or encroaching on the livelihoods of the working class, according to the tax agency.One of the cases reported by the NTS involves a pawnbroker who sold luxury goods that customers had provided as collateral, and then failed to buy them back at an online flea market platform. While selling jewelry, luxury watches and bags, some of which were worth as much as hundreds of millions of won, the pawnbroker disguised the sales as private person-to-person trade to avoid tax. The pawnbroker received payments via borrowed bank accounts, and omitted all of those sales when reporting tax. The pawnbroker's family led a luxurious life, purchas

Jul 28, 2022By Yoon Ja-young
Tax agency reveals luxurious life of alleged tax evaders
Economy

Fed unleashes another big rate hike in bid to curb inflation

U.S. Federal Reserve Board Chairman Jerome Powell holds a news conference after the Fed decided to once again raise interest rates by three-quarters of a percentage point at the William McChesney Martin Jr. Building in Washington, D.C., July 27. The Fed hopes to temper inflation rates, which have reached their highest levels in 40 years. EPA-YonhapThe Federal Reserve on Wednesday raised its benchmark interest rate by a hefty three-quarters of a point for a second straight time in its most aggressive drive in more than three decades to tame high inflation.The Fed's move will raise its key rate, which affects many consumer and business loans, to a range of 2.25 percent to 2.5 percent, its highest level since 2018.Speaking at a news conference after the Fed's latest policy meeting, Chair Jerome Powell stressed that the central bank remains committed to defeating chronically high inflation.At the same time, worry that the Fed's efforts could eventually cause a recession are growing as consumers and businesses struggle with both high prices and rising borrowing rates. On Wednesday, Powell

Jul 28, 2022
Fed unleashes another big rate hike in bid to curb inflation
  • Fed's rate hike to have limited impact on Korean market: finance minister
  • BOK unlikely to take another 'big step' in August
Economy

Dubious foreign exchange remittances at Woori and Shinhan amount to $3.1 billion: FSS

Financial Supervisory Service (FSS) Deputy Governor Lee Joon-soo speaks during a press conference held at the headquarters of the FSS in Seoul, Wednesday. YonhapMost money sent to corporate accounts in Hong Kong by unknown local corporations By Anna J. Park After a month of official investigations, the Financial Supervisory Service (FSS) has found out that over 4.1 trillion won ($3.1 billion) worth of suspicious international money transfers took place at Woori Bank and Shinhan Banks over a one-year period, starting last year. According to the FSS' announcement concerning its investigation of the matter on Wednesday, a total of 22 business entities are involved in the suspicious foreign exchange remittances.At Woori Bank, a total of 1.6 trillion won of abnormal foreign exchange transactions were spotted at the bank's five branches over the course of May of last year to early June of this year. Another 2.5 trillion won of dubious international money transfers were also carried out at 11 Shinhan Bank branches from February of last year to early July of this year. The number of money tr

Jul 27, 2022By Anna J. Park
Dubious foreign exchange remittances at Woori and Shinhan amount to $3.1 billion: FSS
Economy

Local asset markets lukewarm ahead of Fed rate hike

Dealers in Hana Bank's headquarters in Seoul, Wednesday. Yonhap By Lee Min-hyungThe local asset markets displayed lukewarm performance Wednesday, as investors took a wait-and-see approach one day before a possible giant rate hike from the U.S. Federal Reserve. The benchmark KOSPI started with a slight drop of 0.02 percent, and remained weak throughout the day. But it later nudged up with a gain of 0.11 percent, closing at 2,415.53. The secondary Kosdaq also ended with a gain of 0.73 percent to close at 795.70 on the same day.But the Korean won lost much ground against the U.S. dollar. The won-dollar exchange rate increased by 5.7 won from a day earlier and closed at 1,313.5 won.Market participants appeared to sit on the sidelines ahead of the upcoming two-day-long Federal Open Market Committee (FOMC) meeting, where the Fed is widely forecast to increase its key rate by 75 basis points again, repeating the scale of its June rate hike.The crypto market also displayed

Jul 27, 2022By Lee Min-hyung
Local asset markets lukewarm ahead of Fed rate hike
Cryptocurrency

Top management's legal issues weigh on Bithumb sale

The logo of Bithumb is seen in this file photo. Yonhap By Lee Min-hyungFTX's planned acquisition of Bithumb, the second-largest crypto exchange in Korea, is expected to hit a snag due to ongoing legal issues surrounding the exchange's top management. Lee Jung-hoon, the former chairman of Bithumb Holdings, is on trial for charges of fraud after BK Group dropped its plans to acquire the crypto exchange. According to the prosecution, Lee allegedly took $100 million from BK Group Chairman Kim Byung-gun, who is a plastic surgeon, in exchange for the joint management of Bithumb and the promise to issue a new coin at the exchange.The single-largest shareholder of Bithumb's parent company is Vidente. The Kosdaq-listed company has a 34.22-percent stake in Bithumb Holdings.But Lee is seen by many as the de facto owner of Bithumb, considering all of the stakes linked to him. Lee has secured more than a 60-percent stake in Bithumb Holdings by means of DAA, a company he is known

Jul 27, 2022By Lee Min-hyung
Top management's legal issues weigh on Bithumb sale
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