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  • Others

    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

BOK chief highlights central banks' post-pandemic role, worries about low inflation, growth in emerging economies

Rhee Chang-yong, head of the Bank of Korea (BOK), speaks during 'Bank of Korea International Conference 2022' in Seoul, June 2. Yonhap Central banks need to do more than their obligation of maintaining price stability as calls for them to take on more social responsibility will continue to rise in the post-pandemic era, Seoul's top central banker said Thursday.At an international conference in Seoul, Bank of Korea (BOK) Governor Rhee Chang-yong said Korea and other emerging countries are facing a likelihood of returning to a "very low inflation" and "very low growth environment" after current high inflation cools off, due to their "rapid aging problem.""Calls for the social responsibility of central banks are also likely to continue. This is because the shock from the pandemic and the subsequent recovery turned out to be uneven across income groups and industrial sectors," Rhee told the conference held to discuss the role of central banks. "Given the negative percep

Jun 2, 2022
BOK chief highlights central banks' post-pandemic role, worries about low inflation, growth in emerging economies
Economy

Luna 2.0 price volatility raises concerns over possible repeat performance

Seen above is a real-time price chart of Luna 2.0. Screen capture from CoinMarketCapBy Lee Min-hyungTerra Luna 2.0 is facing growing skepticism over its sustainability, as the price for the revived cryptocurrency is taking investors on a roller-coaster ride. The controversial token continues to see volatile ups and downs in the market, rekindling concerns over a possible outcome similar to the recent Luna fiasco. According to data from CoinMarketCap, the Luna 2.0 price once rose to nearly $12 at one time on Tuesday morning, but it has since fluctuated multiple times and plunged down to $6.90 as of 2:35 p.m. Wednesday, a drop of 42.5 percent.For now, Korean crypto exchanges are not offering any trading services for the rebranded Luna token, but it can still be traded on major overseas exchanges. Even if no dataset has been collected, a huge number of Korean investors are known to bet on the new cryptocurrency by engaging in day trading on hopes to generate large gains by taking advantage of its high price volatility.But industry officials advise investors to refrain from taking such a

Jun 1, 2022By Lee Min-hyung
Luna 2.0 price volatility raises concerns over possible repeat performance
Economy

Foreign investors' return raises hope for KOSPI rally

By Lee Min-hyung With foreign investors making a surprise return to the benchmark KOSPI, the Korean stock market is forecast to enjoy momentum for a rebound in tandem with weakening overseas financial uncertainties, analysts said. The main bourse extended a losing streak to this year's new low of 2,540 points last month, hit hard by multiple risk factors, including global monetary tightening and the weakening local currency.With Wall Street experiencing a bigger loss in May, investors' sentiment of fear showed little signs of recovery. But starting late last week, local stocks began picking up momentum for growth with a much-anticipated return of foreign investors.According to data from the Korea Exchange, foreigner net buying of Korean stocks on the main bourse has been on the steep rise for the past week. They purchased local stocks worth 1.72 trillion won ($1.37 billion) for the past four trading days until May. 31.May also marked the first month this year when foreign investor buying of local stocks exceede

Jun 1, 2022By Lee Min-hyung
Foreign investors' return raises hope for KOSPI rally
Economy

Trade deficit concerns weigh on Korean economy

gettyimagesbankCountry suffers trade deficit of $1.71 billion in May on soaring energy pricesBy Lee Kyung-min Korea suffered a trade deficit of $1.71 billion (2.12 trillion won) in May, due largely to a robust export performance being overshadowed by a short-term spike in key commodity import prices, government data showed, Wednesday.The sustained trade deficit over the past two months is expected to weigh heavily on the country's export-reliant economy, as indicated by a widening fluctuation in the price of key input materials for manufacturing, including crude oil, minerals, as well as food, amid global geopolitical volatility. Some market watchers say Korea may see an annual trade deficit this year, a highly concerning yet probable scenario for an economy powered by exports of final goods and services from the import of intermediate goods. Further anchoring the pessimistic view is the market consensus on the steeper price hikes in global commodities in the second quarter of this year, hobbled further by Russia's invasion of Ukraine and China's COVID-19 lockdowns.Data from the Mini

Jun 1, 2022By Lee Kyung-min
Trade deficit concerns weigh on Korean economy
Economy

Foreigners turn net buyers of Korean stocks as recession, China woes ease

A dealer looks at screens displaying the main KOSPI index and won-dollar exchange rate at a Hana Bank branch in central Seoul, May 31. Yonhap Foreign investors have snapped a months-long selling streak and turned to buying Korean stocks, data showed Wednesday, amid eased worries over a global recession and China's struggle with COVID-19 outbreaks.They scooped up a net 1.72 trillion won ($1.38 billion) on the country's main KOSPI market from last Thursday through Tuesday, including about 1.05 trillion won purchased Tuesday alone, according to the Korea Exchange. In May, foreigners bought a net 130.6 billion won, turning net buyers for the first time since December last year on a monthly basis. From the beginning of this year until May 25, they had sold off more than 12 trillion won worth of local equities. Overseas investors account for about 30 percent of the KOSPI. "We have recently seen the foreigners' portion hitting a historical low, but the foreign fund flow is

Jun 1, 2022
Foreigners turn net buyers of Korean stocks as recession, China woes ease
Economy

Exports up 21.3% in May; trade deficit extended on high energy prices

gettyimagesbank Korea's exports rose 21.3 percent in May from a year earlier on solid demand for chips and petroleum products, but the country suffered a trade deficit due to high global energy prices, data showed Wednesday.Outbound shipments stood at $61.52 billion last month, up from $50.73 billion a year earlier, according to the data compiled by the Ministry of Trade, Industry and Energy. It is the highest tally for any May since the ministry began compiling related data in 1956. The previous record was set a year earlier.It is also the second-largest ever monthly figure following the record number of $63.79 billion set in March 2022, the data showed.May marked the 19th consecutive month that the country's exports have logged a year-on-year expansion. Exports also posted double-digit growth for the 15th month in a row last month.But high global energy prices amid the crisis surrounding Ukraine also pushed up the country's imports last month, leading the country

Jun 1, 2022
Exports up 21.3% in May; trade deficit extended on high energy prices
Economy

Gov't plan to scrap double taxation on businesses raises concerns

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho speaks during a meeting with the press corps at the Government Complex in Sejong, Tuesday. A recent feasibility study carried out by an outside research group on behalf of the ministry showed that tax revenue will decrease by 780 billion won ($629.8 million) per year if Korea scraps its policy taxing domestic corporations on all taxable income from their domestic and foreign operations. YonhapBy Yi Whan-wooThe government is considering waiving taxes on the income that domestic corporations earn through their overseas businesses, in line with President Yoon Suk-yeol's vision to create a market-driven economy through regulatory reform. However, the plan is raising concerns over a sharp decline in tax revenues, estimated to be up to 780 billion won ($629.8 million) per year, amid the snowballing national debt.The plan is also casting doubt over whether it will help the Korean businesses find their own country less burdensome in terms of taxation and accordingly, induce massive corporate investments using offshore ca

May 31, 2022By Yi Whan-woo
Gov't plan to scrap double taxation on businesses raises concerns
Economy

Mortgage rates rise to highest in over 9 years amid BOK's monetary tightening

A person passes by a banner giving information on loans at a bank in Seoul, May 25. YonahpKorean banks' mortgage rates rose to their highest level in more than nine years in April as borrowing costs are on the rise amid the central bank's push for monetary tightening to bring inflation down, central bank data showed Tuesday.Rates on mortgages extended by local banks stood at an annual 3.9 percent on average in April, up 0.06 percentage points from a month earlier, according to the data from the Bank of Korea (BOK).They were the highest since the rates rose to 3.97 percent in March 2013.Rates on unsecured household loans also rose 0.16 percentage points month-on-month to a 5.62 percent average in April, which was the highest since June 2014.The rises came as the BOK has increased its policy rate at a fast pace in recent months to keep rising inflationary pressure in check.Last week, the BOK hiked its key interest rate by a quarter percentage point to 1.75 percent. The rate increase was the fifth of its kind since August last year.BOK Gov. Rhee Chang-yong has hinted at further hikes, s

May 31, 2022
Mortgage rates rise to highest in over 9 years amid BOK's monetary tightening
Economy

Gov't dividend income soars 70.5% this year

Finance ministry building in Sejong City / Korea Times fileThe government's dividend income from its stakes in public companies jumped 70.5 percent this year from the previous year as their earnings improved amid the economic recovery, the finance ministry said Tuesday.Dividend payments by 19 state-run companies to the government amounted to 2.45 trillion won ($1.98 billion) this year, up 1.01 trillion won from a year earlier, according to the Ministry of Economy and Finance.The increased dividend income came as state-run firms' bottom lines improved amid the economic recovery. The 19 companies, including state housing developer Korea Land Housing and policy lender the Korea Development Bank, saw their combined 2021 earnings rise 34 percent from a year ago.The average dividend payout ratio, or the percentage of earnings paid to shareholders in dividends, came to 40.38 percent this year, up 3.46 percentage points from a year earlier.Of the 39 state companies in which the government holds stakes, 20 public firms, including the power monopoly Korea Electric Power (KEPCO), did not pay ou

May 31, 2022
Gov't dividend income soars 70.5% this year
Economy

Monthly-rent deals top 50% of home rentals for 1st time in April

gettyimagesbankMonthly lease contracts exceeded half of Korea's home rentals for the first time in April, government data showed Tuesday, due mainly to the impact of new laws that took effect two years earlier meant to protect tenants.The number of monthly home lease contracts, called "weolse" in Korea, came to 130,295 in April, accounting for 50.4 percent of the country's total home rental deals at 258,318, according to the data from the Ministry of Land, Infrastructure and Transport.This marks the first time that the ratio of weolse deals has surpassed the 50-percent level.The remainder were jeonse contracts, or a home rental arrangement unique to Korea.Under Korea's decades-old jeonse system, tenants pay a large lump-sum deposit, known as key money, to the landlord, which is then returned at the end of the rental agreement, which usually lasts two years. During the lease period, the tenants do not pay monthly rent.The ministry attributed the increase in weolse contracts to the implementation in July 2020 of the new laws intended to protect tenants from landlords and excessive rent

May 31, 2022
Monthly-rent deals top 50% of home rentals for 1st time in April
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