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  • Economy

    Weakening won emerges as hurdle to Korea's US investment package

    Korea's weakening currency is emerging as a challenge to the country's planned $350 billion investment package in the United States, analysts said Thursday, as a senior finance ministry official prepares to travel to Washington for talks on foreign exchange market stability. Moon Ji-sung, deputy minister for international affairs at the Ministry of Finance and Economy, will meet senior U.S. Treasury officials in Washington on Friday (local time), according to government sources. Moon's trip is viewed as unusual, as senior officials overseeing foreign exchange policy rarely make separate visits to Washington outside regular consultation channels between the two countries' finance authorities. While the ministry declined to comment on the details of Moon's visit, market watchers expect the discussions to focus on ensuring that exchange rate volatility does not disrupt implementation of Korea's investment commitments in the U.S. The Korean won has remained under pressure in recent weeks, with the won-dollar exchange rate hovering around 1,500-level and trading near its weakest level since 2

    3 MIN READBy Lee Hyo-jin
    Weakening won emerges as hurdle to Korea's US investment package
  • Economy

    InterviewHong Kong's role as Korea-China business bridge grows, Chinese chamber chief says

    3 MIN READBy Lee Yeon-woo
    Hong Kong's role as Korea-China business bridge grows, Chinese chamber chief says
  • Economy

    Seoul shares close higher as AI woes ease amid Middle East uncertainties

    1 MIN READBy Yonhap
    Seoul shares close higher as AI woes ease amid Middle East uncertainties
  • Policy

    Korea's tax agency seeks transformation from tax collector to integrated revenue authority

    3 MIN READBy Jun Ji-hye
    Korea's tax agency seeks transformation from tax collector to integrated revenue authority
  • Economy

    Gov't calls on exporters to address FX volatility

    1 MIN READBy Yonhap
    Gov't calls on exporters to address FX volatility
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Economy

IMF cuts global growth forecast due to "seismic waves" from Russia's war in Ukraine

World Bank Group President David Malpass, left, and IMF Managing Director Kristalina Georgieva take part in the 'The Way Forward: Responding to Global Shocks and Managing Uncertainty' event during the 2022 Spring Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) in Washington, April 19, in this handout photo made available by the WBG. The International Monetary and Financial Committee, the Development Committee and G20 meetings will be held in a hybrid format and participants of those restricted meetings may participate in person or virtually. EPA-Yonhap The International Monetary Fund slashed its forecast for global economic growth by nearly a full percentage point Tuesday, citing Russia's war in Ukraine, and warning that inflation was now a "clear and present danger" for many countries.The war is expected to further increase inflation, the IMF said in its latest World Economic Outlook, warning that a further tightening of Western san

Apr 20, 2022
IMF cuts global growth forecast due to "seismic waves" from Russia's war in Ukraine
Economy

War-induced agflation impacts Korean economy

gettyimagesbankConsumer prices of processed food products expected to rise by 6.8 percent in Korea this yearBy Anna J. ParkGlobal supply chain disruptions compounded by Russia's invasion of Ukraine are pushing up the prices of many crops, leading to concerns over “agflation.” Korea is feared to be especially vulnerable due to its dependence on imports of food products.Agflation ― a word combining “agriculture” and “inflation” ― describes the phenomenon of food prices rising more rapidly than the prices of other goods and services.Global corn prices rose to a nearly 10-year high, with the contracts for July corn futures traded at $8.04 per bushel at the Chicago Board of Trade (CBOT) on Monday. This is the first time that the corn price exceeded $8 per bushel since September 2012, a jump from around $6 per bushel at the start of the year.As corn is just one of many crops seeing prices surge recently, agflation is no longer merely a concern but has become a reality for the global economy. There are a few reasons behind the surging prices of agricultur

Apr 20, 2022By Anna J. Park
War-induced agflation impacts Korean economy
Economy

IMF cuts Korea's 2022 growth forecast to 2.5% from 3%

International organization slashes outlook for world economy to 3.6% from 4.4%By Yi Whan-wooThe International Monetary Fund (IMF) slashed its 2022 growth forecast for Korea to 2.5 percent, Thursday, down from 3 percent in its previous outlook given in January. The lowered economic outlook for the world's 10th-largest economy comes as uncertainty has been growing amid a prolonged war in Ukraine and soaring inflation, which the IMF said has been casting a shadow on major and emerging economies alike.The IMF kept its economic outlook for Korea in 2023 unchanged at 2.9 percent.This was the IMF's first update on its World Economic Outlook report since the beginning of Russia's invasion of Ukraine, Feb. 24. The crisis increased downside risks for the global economy due to slowed growth in China, supply chain disruptions and the spread of the COVID-19 Omicron variant. The IMF accordingly revised down the global economic outlook to 3.6 percent from 4.4 percent, compared to the World Bank which slashed its global growth forecast to 3.2 percent from 4.1 percent.The International Monetary Fund

Apr 19, 2022By Yi Whan-woo
IMF cuts Korea's 2022 growth forecast to 2.5% from 3%
Economy

BOK chief nominee underlines need for rate hike in tandem with growth

Bank of Korea (BOK) Governor nominee Rhee Chang-yong speaks during a hearing at the National Assembly on Yeouido in Seoul, Tuesday. YonhapBy Yi Whan-wooBank of Korea (BOK) Governor nominee Rhee Chang-yong addressed a need for additional hikes in the benchmark interest rate against soaring inflation, Thursday, stressing that rate hikes should be signaled in advance even if they are unpopular.Speaking at a National Assembly hearing, Rhee, however, hinted at adjusting the pace of the hikes in tandem with economic growth, over concerns that tightening the monetary policy could stand in the country's path to economic recovery.The Assembly hearing came as the BOK is increasingly urged to coordinate with the government on a policy mix of fiscal and monetary policies, amid a leadership vacuum after its former governor, Lee Ju-yeol, retired on March 31.Rhee has been awaiting Assembly confirmation to take office since March 23 when President Moon Jae-in tapped him for the post.“The upward trend in prices is likely to go on for at least the next year or two,” he said. “I will

Apr 19, 2022By Yi Whan-woo
BOK chief nominee underlines need for rate hike in tandem with growth
Economy

Cryptocurrencies bounce back on hopes for crypto ETFs

gettyimagesbankBy Lee Min-hyungCryptocurrencies are bouncing back on growing hopes for the launch of crypto-related exchange-traded funds (ETFs).Prices of major cryptocurrencies have shown a pattern of correlation with the U.S. stock market, so most digital assets entered a bear market in line with weak performance of key U.S. stock indexes.But cryptocurrencies took a turn for the better on Tuesday after multiple overseas reports raised the possibility of the arrival of a spot Bitcoin ETF as soon as the end of the year.According to pricing from CoinGecko, a cryptocurrency data aggregator, the prices of the world's top 10 cryptocurrencies by market capitalization have achieved a meaningful rebound. Bitcoin prices jumped by 4.4 percent at 3:10 p.m. Tuesday from a day earlier, with Ethereum, the second-most valuable cryptocurrency, also rising by more than 4 percent during the same period.Starting this month, Bitcoin prices slipped and looked to show signs of losing momentum for an additional rally. Bitcoin was traded at around $40,750 (50 million won) during the same time, clearing awa

Apr 19, 2022By Lee Min-hyung
Cryptocurrencies bounce back on hopes for crypto ETFs
Economy

Public firms concerned about restructuring under incoming Yoon administration

The incoming administration's finance minister nominee, Choo Kyung-ho, heads to his temporary office in central Seoul, Thursday. Yonhap By Anna J. ParkConcerns are growing among employees of state-owned companies about their job stability, as the incoming Yoon administration is expected to pursue major restructuring of public firms under the premise of increasing efficiency. Such concerns are based on the fact that Choo Kyung-ho, the nominee for the positions of finance minister and deputy minister for economic affairs of the Yoon Suk-yeol administration, has been calling for years to overhaul and restructure public firms. When he was serving as the first vice minister of the finance ministry in 2013 in the Park Geun-hye administration, he urged public companies to undergo restructuring to eliminate “lax management” and resolve those public institutions' deficits. According to ALIO, an information portal on public institutions, the number of employees of the country

Apr 19, 2022By Anna J. Park
Public firms concerned about restructuring under incoming Yoon administration
Economy

ELS sales in S. Korea decline by more than half in Q1

Employees of Hana Bank work at a dealing room of the bank's headquarters in central Seoul, Monday. YonhapSales of equity-linked securities (ELS) in South Korea declined by more than half in the first quarter from three months earlier amid the coronavirus pandemic, data showed Monday.The total value of ELS products stood at 12.4 trillion won (US$10.1 billion) in the January-March period, down 51.8 percent from the previous quarter, according to the data from the Korea Securities Depository. The tally is also down 36 percent from the same period a year earlier.ELS refers to hybrid securities whose returns are linked to the performance of underlying equities, including a stock index.In the first quarter, the global surge of COVID-19 cases weighed on investors' appetite for risky assets around the world, leading to losses in major stock indexes. Uncertainties over the Russia-Ukraine war and the U.S. Federal Reserve's policy tightening added to the losses.Sales of ELS tracking South Korea's KOSPI 200 nose-dived 52.7 percent from three months earlier, and those based on the SP 500 fell 4.3

Apr 18, 2022
ELS sales in S. Korea decline by more than half in Q1
Economy

Banking shares remain solid amid foreigners' selling spree

gettyimagesbankExperts show upbeat outlook over banks' earnings amid rising interest ratesBy Anna J. ParkDespite a selling spree by foreign investors this year, domestic banking shares have been bullish during the past month as the sector has been the main beneficiary of rising interest rates.According to the Korea Exchange, Shinhan Financial Group shares rose 6.33 percent from March 15 to April 15. Woori Financial Group shares also rose 5.19 percent during the same period, followed by KB Financial Group which rose 4.76 percent and Hana Financial Group which increased 1.15 percent. Considering the fact that some major Korean conglomerates saw their stock prices fall during the same period, the solid performance of banking shares has stood out in particular. During the past month, the stock price of Samsung Electronics, the country's top company in terms of market cap, fell 4.17 percent, while those of big-tech internet portal groups such as Naver and Kakao each decreased 5.8 percent and 7.37 percent. Continued net selling by foreign investors has been making the Korean stock market m

Apr 18, 2022By Anna J. Park
Banking shares remain solid amid foreigners' selling spree
Economy

Hong to discuss Korea's financial soundness on last overseas visit

Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki attends a meeting of the Central Disaster and Safety Countermeasures Headquarters in Seoul, Friday. He is currently visiting the United States in the last overseas business trip of his term. YonhapFinance minister also plans to visit Singapore to discuss CPTPP By Yi Whan-wooDeputy Prime Minister and Minister of Economy and Finance Hong Nam-ki will address Korea's efforts to reach global climate change goals and deal with the impact of the Ukraine crisis on his last overseas visit as the top economic policymaker of the world's 10th-largest economy.Hong is traveling to the U.S. and later will fly to Singapore in a trip that on began Sunday, with less than a month remaining before the incoming Yoon Suk-yeol administration takes power.In addition to global issues, the finance minister will meet relevant representatives and address Korea's efforts toward financial soundness in relation to S&P's sovereign ratings, an investor-friendly financial market in relation to the Morgan Stanley Capital International (MSCI) ind

Apr 18, 2022By Yi Whan-woo
Hong to discuss Korea's financial soundness on last overseas visit
  • Korea joining CPTPP tall task for Yoon administration
Economy

Lifting social distancing measures unlikely to boost economy amid inflation woes

Seen above is a notice about price increases for some menu items at a restaurant in Seoul, April 11. YonhapBy Lee Min-hyungThe Korean government's plan to lift social distancing measures will not bring any tangible effects to boosting the overall economic recovery due to lingering inflationary pressure and key rate hikes, experts said Sunday. The outlook came amid expectations for a revival of domestic consumption after the government on Monday put an end to the limits on private gatherings and business operating hours imposed after the outbreak of the COVID-19 pandemic here back in March 2020.Even if increased face-to-face consumption spending is anticipated, this factor will not be able to offset other downward pressures on the economy, local economists viewed.Despite the easing of social distancing, the economy will likely continue grappling with inflationary woes, as a complex set of external uncertainties ― surrounding geopolitical risk factors in Eastern Europe and the U.S. Fed's planned interest rate hikes ― remain in place.According to recent data from Statistics Korea, the n

Apr 17, 2022By Lee Min-hyung
Lifting social distancing measures unlikely to boost economy amid inflation woes
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