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  • Economy

    Rate hike seen as strongest tool to support won as FX measures lose impact

    Korea’s financial authorities appear to be running out of options to stem the continued weakening of the won, with analysts on Friday saying a benchmark rate hike is effectively the strongest tool left for policymakers. Despite repeated verbal warnings from authorities and a rare joint inspection of banks’ currency operations, the won has remained under pressure against the U.S. dollar, prompting market participants to look beyond conventional intervention measures. In recent weeks, the won-dollar exchange rate has hovered around the 1,500 level, putting the local currency at its weakest point since 2009 during the global financial crisis. Last Monday, the Ministry of Finance and Economy and the Bank of Korea issued a rare joint warning that they would respond firmly to excessive volatility and one-sided market moves. At the time, the currency opened at 1,555.2 won per dollar — its weakest level in 17 years and three months — before recovering to close onshore trading at 1,535 won, an improvement of 4.1 won from the previous session following the verbal intervention. However, it

    2 MIN READBy Lee Hyo-jin
    Rate hike seen as strongest tool to support won as FX measures lose impact
  • Economy

    Fraudulent ChatGPT Pro charges spark alarm over unauthorized use of stolen card data

    2 MIN READBy Lee Hyo-jin
    Fraudulent ChatGPT Pro charges spark alarm over unauthorized use of stolen card data
  • Others

    Foreign investors return to KOSPI buying, powering rally above 8,000

    3 MIN READBy Jun Ji-hye
    Foreign investors return to KOSPI buying, powering rally above 8,000
  • Policy

    5 nations sign AI alliance pact to shape global tech rules

    2 MIN READBy Jhoo Dong-chan
    5 nations sign AI alliance pact to shape global tech rules
  • Economy

    Korean won gains on renewed hope of U.S.-Iran peace deal, foreign net buying

    1 MIN READBy Yonhap
    Korean won gains on renewed hope of U.S.-Iran peace deal, foreign net buying
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Economy

Commercial banks burdened over Moon's savings assistance funding

A branch of KB Kookmin Bank in Seoul posts a notice about the state-backed savings product available exclusively for customers aged between 19 and 34 on Feb. 21. / NewsisBy Anna J. Park As a state-backed savings product available exclusively for young people ended up receiving nearly 3 million customers, banks' burden related to the savings product is expected to exceed at least 1 trillion won ($815 million). It is only one of the cases in which financial firms have been made to sacrifice their financial soundness while executing government policies that go against market principles. The state-backed savings product, dubbed “Youth Hope Savings,” was originally planned to be sold to only 380,000 applicants, with 45.6 billion won budgeted by the government. Only those aged between 19 and 34 with an annual income below 36 million won were eligible to apply for the savings product. The product that is promoted to yield up to 10 percent went on sale on Feb. 21 for two weeks at 11 state-run and commercial banks. But it drew more than 2.9 million customers signing up for the sav

Mar 7, 2022By Anna J. Park
Commercial banks burdened over Moon's savings assistance funding
Economy

Korean won falls to 21-month low amid deepening geopolitical risks

Regulators intervene in market on investors' growing woesBy Lee Min-hyungKorea's financial markets took a heavy beating Monday, with its currency and stocks both sinking on escalating geopolitical uncertainties in Eastern Europe, after Russian troops shelled a nuclear power plant in Ukraine.The Korean won extended a loss of 12.9 won against the U.S. dollar, closing at 1,227.1 won per dollar, the lowest level in 21 months. This is the first time since June 2020 that the exchange rate topped the 1,220 mark. The won's sharp depreciation is spawning fears that it will continue pulling up consumer prices, which are being driven up by prolonged global supply bottlenecks and oil price hikes.The won lost its ground due to investors' growing preference for safer assets amid the prolonged armed conflict between Moscow and Kyiv, according to market analysts.“The Korean won will remain weak, and the dollar is expected to gain more ground from a near-term perspective, in that Russia could drag out the Ukraine crisis,” NH Investment & Securities analyst Kwon Ah-min said.Earlier, th

Mar 7, 2022By Lee Min-hyung
Korean won falls to 21-month low amid deepening geopolitical risks
Economy

Korean companies delaying IPOs amid lackluster KOSPI

gettyimagesbankBy Lee Min-hyungKorean companies are delaying their schedules for their initial public offerings (IPOs) amid the weakening performance of the stock market here.Up until early this year, market sentiment was better than it is now, so, many companies, planning to go public were busy arranging pre-IPO schedules with underwriters in the hopes that they would be able to attain windfalls through IPOs, just as many other firms did last year.However, with market sentiment weakening rapidly in more recent weeks, most companies are taking a wait-and-see approach, adjusting their IPO schedules to the latter half of this year.Hyundai Engineering was the first to make such a decision. The company had been drawing keen attention from investors, as its post-IPO valuation was estimated to reach as high as 10 trillion won.However, after the company decided to cancel its plans on Jan. 28, other companies also moved to follow suit for similar reasons as the Hyundai affiliate. At that time, Hyundai Engineering explained it had decided to drop the IPO procedure on concerns that the market

Mar 7, 2022By Lee Min-hyung
Korean companies delaying IPOs amid lackluster KOSPI
Economy

Seoul to implement export ban against Belarus amid Ukraine crisis

Officials from the Ministry of Economy and Finance and other economy-related government organizations participate in a meeting to discuss trade issues surrounding Russia's invasion of Ukraine, at the Government Complex Seoul, Sunday. Courtesy of Ministry of Economy and FinanceSouth Korea will ban exports of strategic items to Belarus starting this week as the former Soviet republic has been supporting Russia's invasion of Ukraine, the finance ministry said Sunday. The move came after South Korea decided to ban exports to 49 Russian organizations and firms last week, including Russia's defense ministry. Under the measure, a license is required to export or transfer major items to these entities, with limited exceptions."As we have concluded that the Republic of Belarus has been effectively supporting Russia's invasion of Ukraine, we have decided to implement the export ban on Belarus as well," the Ministry of Economy and Finance said in a statement.The government announced restrictions against two Belarusian entities, including its defense ministry."We will promptly notify the United

Mar 6, 2022
Seoul to implement export ban against Belarus amid Ukraine crisis
Economy

Trading of Russia ETF to be suspended

This picture, taken on March 4, shows a residential building damaged by shelling the day before in the northern Ukraine city of Chernihiv. AFP-YonhapBy Lee Min-hyungThe Korea Exchange will suspend trading of a Seoul-listed Russia-related exchange-traded fund (ETF) from Monday amid the country's full-scale invasion of Ukraine.Under the decision, any trading of the KINDEX Russia MSCI ETF ― operated by Korea Investment Management ― will come to a temporary halt until further notice, according to the exchange operator. The fund is the only Russia-related ETF sold here.“This is part of a move to protect investors and stabilize the market, and the trading suspension will remain in place for the time being,” the exchange said in a recent statement.The announcement came at a time when Russia is escalating its invasion of Ukraine, which has been jolting the global asset market for the past few weeks. But data showed that retail investors here have been on a buying spree of the ETF for the past two weeks on hopes for its rebound after bottoming out due to the war risk.According to

Mar 6, 2022By Lee Min-hyung
Trading of Russia ETF to be suspended
Economy

Soaring inflation weighs further on Korean economy

Energy prices push consumer prices up 3% for five months straightBy Yi Whan-wooFears are looming that Korea may not be able to tackle the rise in inflation that analysts largely attribute to surging oil prices pressured further by Russia's invasion of Ukraine. Reports released Friday showed a 3 percent increase for the fifth month straight in February.Economy watchers said the high price of dining out, another major cause of inflation last month, is anticipated to climb further as the government eases social distancing rules and consumers release their pent-up desire for outdoor activities.According to Statistics Korea, Friday, consumer prices gained 3.7 percent year-on-year last month, after advancing 3.2 percent in October, 3.8 percent in November, 3.7 percent in December and 3.6 percent in January.The quarterly figure continues to remain above 3 percent for the first time in almost a decade, with the high prices of petroleum products and dining out combined accounting for 1.6 percent of February's inflation.Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki, sec

Mar 4, 2022By Yi Whan-woo
Soaring inflation weighs further on Korean economy
Economy

Korea's crypto exchanges join sanctions against Russia

gettyimagesbank By Yi Whan-wooThe country's cryptocurrency exchanges are joining international sanctions against Russia, amid speculation Moscow will exploit digital currencies to bypass the U.S.-led restrictions on its mainstream finance in punishment of its invasion of Ukraine.According to industry sources, Friday, all top four digital currency exchanges ― Bithumb, Upbit, Coinone and Korbit ― have blocked Russian IP addresses in an effort to join global sanctions against Moscow.The sources said the four can also turn down withdrawal requests if the transactions are found to be related to Russia.On Wednesday, a smaller exchange, Gopax, froze some 20 accounts registered by Russian users and barred IP addresses from Russia.The measures come amid calls on cryptocurrency exchanges to comply with the sanctions aimed at squeezing Russia's economy and severing it completely from the global financial system.The sanctions have expelled Russian banks from SWIFT, the main glo

Mar 4, 2022By Yi Whan-woo
Korea's crypto exchanges join sanctions against Russia
Economy

Inflation growth hits over 3 percent for 5th month amid soaring oil

Gas prices are seen at a filling station in Seoul, Thursday. YonhapKorea's consumer prices grew more than 3 percent for the fifth straight month February as energy costs spiked amid the Ukraine crisis, data showed Friday. Consumer prices rose 3.7 percent year-on-year last month, compared with a 3.6 percent gain in January, according to the data compiled by Statistics Korea.The country's consumer inflation has grown more than 3 percent since October last year. Inflation growth has stayed above 2 percent ― the central bank's inflation target over the medium term ― for the 11th consecutive month.Core inflation, which excludes volatile food and oil prices, advanced 2.9 percent year-on-year last month, the fastest gain since June 2009.High inflation came as oil prices surged on tight supplies and tensions over Russia's invasion of Ukraine.Dubai crude, South Korea's benchmark, came to US$110.05 per barrel Wednesday, up from $77.12 at the end of last year. South Korea depends mainly on imports for its energy needs. (Yonhap)

Mar 4, 2022
Inflation growth hits over 3 percent for 5th month amid soaring oil
Economy

Korea wins exemption from US' expanded export restrictions on Russia

Korean Trade Minister Yeo Han-koo poses for a photo with U.S. Deputy Secretary of Commerce Don Graves during their meeting in Washington, Friday, in this photo provided by the South Korean ministry. Yonhap Korea won an exemption from the United States' expanded export restrictions on Russia over its invasion of Ukraine, Seoul's industry ministry said Friday.Last week, the U.S. government announced the Foreign Direct Product Rule (FDPR) for "all of Russia" as part of its export controls to block Russia's access to global high-tech products and other major items, such as semiconductors. The measure calls on companies to receive a license from the U.S. for tech-related items using U.S. technology before they can be shipped to Russia, which is feared to affect major South Korean exporters, as they use U.S. technology and software.Trade Minister Yeo Han-koo met with senior U.S. officials in Washington, Thursday, and the two sides agreed to include South Korea in the U.S.

Mar 4, 2022
Korea wins exemption from US' expanded export restrictions on Russia
Economy

Korea to extend fuel tax cuts by 3 months until end of July: FM

Finance Minister Hong Nam-ki, right, participates in a meeting on inflation in Seoul, Friday. Yonhap The government will extend fuel tax cuts by three months as it strives to ease the burden on consumers and a build-up of inflationary pressure, the country's top economic policymaker said Friday. On Nov. 12, the government lowered fuel taxes by a record 20 percent in a bid to tame inflationary pressure. The tax reduction was set to expire at the end of April. The government decided to keep the fuel tax cuts in place for three more months until the end of July amid concerns that the war in Ukraine could drive up energy prices in the near future."If economic uncertainty mounts further as international oil prices grow at a faster pace than current levels, we will also consider expanding the extent of fuel tax cuts," Finance Minister Hong Nam-ki told a meeting on inflation.Korea is confronted with increasing inflationary pressure in the face of a recovery in demand from

Mar 4, 2022
Korea to extend fuel tax cuts by 3 months until end of July: FM
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