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    KOSPI plunges 8% on concerns over end of chip earnings cycle, interest rate hike

    Korean stocks tumbled Monday, as a broad-based correction in global semiconductor shares triggered heavy selling across the market, prompting the activation of both sidecar trading curbs and circuit breakers on the KOSPI and Kosdaq markets. Attention is centered on whether KOSPI, which has staged a record-breaking rally this year, can resume its upward trajectory after a short-term correction or whether market volatility will intensify further. The benchmark KOSPI opened 112.50 points, or 1.38 percent, lower at 8,048.09 before extending its losses throughout the session to close at 7,484.41, down 676.18 points, or 8.29 percent. The index reached an all-time intraday high of 8,933.62 on June 2. After plunging 5.54 percent on Friday, the KOSPI posted losses for a second consecutive session, underscoring growing concerns over a pullback in semiconductor stocks that had fueled the market's recent rally. Amid heavy selling pressure, trading restrictions kicked in shortly after the market opened, with a Level 1 circuit breaker triggered at 9:03 a.m. and a sell-side sidecar activated at 9:34 a.

    3 MIN READBy Jun Ji-hye
    KOSPI plunges 8% on concerns over end of chip earnings cycle, interest rate hike
  • Economy

    Lee attributes weakening won to foreign investors' portfolio rebalancing

    2 MIN READBy Lee Hyo-jin
    Lee attributes weakening won to foreign investors' portfolio rebalancing
  • Economy

    Financial authorities vow stern action against excessive volatility, one-sided FX market moves

    2 MIN READBy Yonhap
    Financial authorities vow stern action against excessive volatility, one-sided FX market moves
  • Economy

    Corporate lending grows at fastest pace in 3 1/2 years in Q1: BOK

    1 MIN READBy Yonhap
    Corporate lending grows at fastest pace in 3 1/2 years in Q1: BOK
  • Economy

    Economy continues 'gradual improvement' on strong chip exports: KDI

    2 MIN READBy Yonhap
    Economy continues 'gradual improvement' on strong chip exports: KDI
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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

Inflation growth hits nearly 14-year high in May on high energy prices

gettyimagesbankKorea's consumer prices rose at the fastest clip in almost 14 years in May due to high energy and food costs over the protracted war between Russia and Ukraine and the economic recovery, data showed Friday.Consumer prices jumped 5.4 percent last month from a year earlier, accelerating from a 4.8 percent year-on-year spike in April, according to the data from Statistics Korea.This marked the steepest such increase since August 2008, when consumer prices soared 5.6 percent. Inflation growth also exceeded 5 percent for the first time since a 5.1 percent rise in September 2008.Consumer prices rose above 2 percent ― the central bank's inflation target over the medium term ― for the 14th straight month.Core inflation, which excludes volatile food and oil prices, advanced 3.4 percent year-on-year last month, the highest since February 2009. "Prices of petroleum products and processed food, and personal services costs extended their high growth. Price growth of farm products also picked up," Eo Woon-sun, a senior Statistics Korea official, told reporters.Korea faces growing in

Jun 3, 2022
Inflation growth hits nearly 14-year high in May on high energy prices
Economy

Yoon administration expected to appoint heads of financial authorities soon

The signboard of Financial Services Commission (FSC) in central Seoul / YonhapBy Anna J. ParkWith the completion of the June 1st local election, the market's focus is now on when the Yoon Suk-yeol administration will carry out the delayed appointments of the heads of key financial authorities ― the Financial Services Commission (FSC) and Financial Supervisory Service (FSS).Since the resignation of FSC chief Koh Seung-beom in early May, the top post at the financial regulator remains vacant. There have been reports that Kim Joo-hyun, chair of the Credit Finance Association, has been selected to lead the FSC. However, the appointment of a new FSC chief has yet to be announced, only increasing uncertainty in the market.As the appointment of the country's top financial regulator is being delayed, other state-run organizations, such as the Financial Supervisory Service (FSS) and Korea Development Bank (KDB), are also seeing those positions remain vacant. The situation is unusual when considering that the appointment of the FSC chief comes as one of the first priorities when a new administ

Jun 3, 2022By Anna J. Park
Yoon administration expected to appoint heads of financial authorities soon
Economy

Finance chief urges firms to refrain from hiking goods prices to curb inflation

Finance Minister Choo Kyung-ho / YonhapThe finance minister called on local companies Thursday to refrain from hiking prices of products, and wages, as the move could add upward pressure to already high inflation.Finance Minister Choo Kyung-ho made the call during his first meeting with the heads of six business lobby groups at a time when inflationary pressure has mounted amid soaring fuel and food costs."We hope companies can digest factors that cause price hikes as much as possible through ways to enhance productivity and other means," Choo said.Korea faces growing inflationary pressure as crude oil and other commodity prices have risen due to the protracted war between Russia and Ukraine and global supply disruptions. Demand-pull inflation has also increased amid the economic recovery.Inflation growth is widely expected to exceed 5 percent in the coming months. Consumer prices spiked at 4.8 percent year-on-year in April, the fastest rise in more than 13 years.Meanwhile, Choo welcomed large firms' latest plans to increase investment, vowing the government will promote policies to

Jun 2, 2022
Finance chief urges firms to refrain from hiking goods prices to curb inflation
Economy

Insurance fraud becoming bigger, better organized

gettyimagesbankFinancial authorities and insurers strengthen inspection to curb growing insurance fraudBy Anna J. ParkInsurance fraud in the country is not only becoming more prevalent in recent years but also more “organized” due to advances in fraud methods, data showed. Insurance companies and supervisory authorities are thus pondering ways to strengthen their monitoring for fraud attempts. According to the Financial Supervisory Service (FSS) and Rep. Kang Min-kuk of the ruling People Power Party, the total amount of money involved in insurance fraud cases stood at 943 billion won ($752 million) last year, which is up 5 percent from the year before. The number of fraud suspects, meanwhile, saw a year-on-year decrease of 1.2 percent. This means that the average fraud case is dealing with bigger amounts of money with fewer people involved, which is explained by the increasing development and sophistication of fraud methods in recent years.The problem is not something that can be ignored by insurers, as the total amount of money caught up in insurance fraud is increasing

Jun 2, 2022By Anna J. Park
Insurance fraud becoming bigger, better organized
Economy

More securities firms set to join move to establish alternative trading system

Korea Exchange's Seoul office building / YonhapBy Lee Min-hyungMore securities firms are moving to speed up their discussions on establishing the nation's first alternative trading system (ATS). The ATS establishment committee ― which consists of the Korea Financial Investment Association (KFIA) and a group of seven major securities firms here ― will grow in size, with a group of more than 20 other mid- to small-sized brokerage houses that are showing an interest in joining the committee.This is expected to help speed up the long-awaited establishment of the ATS, which refers to a non-exchange trading platform. The Korea Exchange has for more than six decades served as the sole stock trading authority here, and expectations are that the possible launch of the first ATS here will help reshape the industry in a way that will foster competition with the existing exchange operator.It has not been confirmed what kinds of services will be available through the ATS, but investors are widely expected to engage in stock transactions even at night. For now, investors can buy and sell listed st

Jun 2, 2022By Lee Min-hyung
More securities firms set to join move to establish alternative trading system
Economy

1970s-style oil shock unlikely despite crunch: BIS economist

The 'Bank of Korea Conference 2022' is held at the Westin Josun Hotel in central Seoul, June 2. YonhapThe return of the nightmarish oil shock of the 1970s is unlikely despite tight supply stemming from the Ukraine war, largely due to the world's dwindling dependence on fossil fuels and stronger policy frameworks, an economist at the Bank for International Settlements (BIS) said Thursday. Global oil prices have skyrocketed as Russia's invasion of Ukraine in February this year triggered Western economies' sanctions on Russia, including a trade ban on Russian oil and agricultural commodities. Russia accounts for more than 10 percent of the world's wheat and oil productions and more than 20 percent of natural gas, and it is a key supplier of industrial metals, according to BIS data. During an economic conference hosted by the Bank of Korea (BOK) in Seoul, Shin Hyun-song, an economic adviser and head of research at the BIS, said, "Low energy dependence and stronger policy frameworks make a repeat of the 1970s unlikely, although high and volatile commodity prices could still be disruptive.

Jun 2, 2022
1970s-style oil shock unlikely despite crunch: BIS economist
Economy

Cryptocurrency's decoupling with Nasdaq accelerates after Luna scandal

The once-red hot price of Luna token is displayed at a customer service center of Bithumb in Seoul, May 27. YonhapBy Lee Min-hyungCryptocurrency's decoupling with the Nasdaq is accelerating in the wake of the recent collapse of Terra's Luna token.Before the abrupt crash of the once-popular Terra ecosystem, overall cryptocurrency prices moved in tandem with the Nasdaq. According to data from CoinMarketCap, Bitcoin's price fell by around 2.4 percent at 8 a.m., May 28. This was in contrast to an overnight rebound of major Wall Street indexes. The S&P 500 closed with a gain of 2.47 percent on Friday, with the Nasdaq extending a gain of 3.33 percent during the same period.The decoupling between Bitcoin and U.S. stock indexes was not evident before the Luna collapse. Crypto investors have so far been paying close attention to the ups and downs of the Nasdaq this year when investing in Bitcoin and other altcoins, as their price movement coupled with each other amid growing woes over risky assets after the U.S. started its monetary tightening policy.The recent decoupling was largely attr

Jun 2, 2022By Lee Min-hyung
Cryptocurrency's decoupling with Nasdaq accelerates after Luna scandal
Economy

Institutions' foreign securities holdings down in Q1

The Bank of Korea / YonhapKorean institutions' investment in foreign securities declined in the first quarter of this year amid estimated losses from their bond and stock holdings, central bank data showed Thursday.The outstanding value of foreign securities held by local institutional investors stood at $395.88 billion as of end-March, down $11.28 billion, or 2.8 percent, from three months earlier, according to the data from the Bank of Korea (BOK).The decline is blamed on losses caused by bond price falls amid high-rise global yields and stock market downswings.The on-quarter decline was the quickest since the value of their holdings fell 3.2 percent in the second quarter of 2013, the BOK said. Foreign securities include stocks, bonds and "Korean paper," which refers to foreign currency-denominated securities issued by the Korean government, banks and companies in overseas markets.Local institutions' investment in foreign stocks shrank by $1.46 billion on-quarter, and the value of their foreign bond holdings contracted $6.74 billion over the same period. Their investment in Korean

Jun 2, 2022
Institutions' foreign securities holdings down in Q1
Economy

Banks' asset health improves with bad loans down in Q1

The Financial Supervisory Service (FSS) / YonhapKorean banks' nonperforming loans declined in the first quarter of this year, indicating an improvement in their overall asset soundness, data showed Thursday.Bad loans at local banks stood at 10.8 trillion won ($8.6 billion) at the end of March, down 1 trillion won, or 8.1 percent, from three months earlier, according to the preliminary data from the Financial Supervisory Service (FSS).The ratio of their bad loans to outstanding credit fell 0.05 percentage point to 0.45 percent. The ratio was also down 0.17 percentage point from a year earlier. The bad loans refer to lending with interest payments overdue for three months or longer.Of the total nonperforming loans, corporate lending made up 9.2 trillion won, while household credit totaled 1.5 trillion won, the data showed. As of end-March, banks' loan loss reserves stood at 181.6 percent, up 15.7 percentage points from three months earlier. They were also 44.3 percentage points higher than a year earlier. The FSS said banks' asset health has been improving as indicated by those latest

Jun 2, 2022
Banks' asset health improves with bad loans down in Q1
Economy

Online shopping continues to grow in April amid non-contact trend

gettyimagesbankOnline shopping in Korea continued to grow in April as eased virus curbs and the economic recovery boosted demand for travel services and foodstuffs, data showed Thursday.The value of online shopping transactions stood at 16.5 trillion won ($13.2 billion) in April, up 11.9 percent from the previous year, according to the data from Statistics Korea.Purchases made through smartphones, tablets and other mobile devices rose 15.7 percent on-year to 12.3 trillion won. Mobile shopping accounted for 74.6 percent of the total value of online shopping.Online shopping has increased as the COVID-19 pandemic prodded people to shun offline stores.Online purchases of travel and transportation services grew by the largest amount in April as the lifting of virus curbs boosted demand for travel. They jumped 627.5 billion won, or 89.8 percent, on-year to 1.33 trillion won.On April 18, Korea lifted most coronavirus restrictions, except the mask mandate, in a major step toward returning to pre-pandemic life.In April, online transactions of food and beverage rose 321.1 billion won, or 16.6

Jun 2, 2022
Online shopping continues to grow in April amid non-contact trend
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