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| Financial Services Commission (FSC) Vice Chairman Kim So-young speaks during a market monitoring meeting hosted by the financial regulator at the Seoul government complex, Tuesday morning. Courtesy of FSC |
FSC, BOK and finance ministry stress need for alertness over market risk factors
By Anna J. Park
Responding to increased global macroeconomic uncertainties, financial authorities on Tuesday reaffirmed their strong determination to closely monitor the markets and take preemptive steps, if necessary, to deal with volatility.
During a market monitoring meeting hosted by the Financial Services Commission (FSC) on Tuesday morning, the top financial regulator and other key financial agencies, including the Financial Supervisory Service (FSS) and the Korea Center for International Finance (KCIF), discussed the current global financial market situation and assessed the main risk factors.
"The current economic and financial situations represent a pretty difficult phase, where a high level of inflation continues against the backdrop of major countries accelerating their monetary tightening policies and the continued heightened threat of geopolitical risks, such as the Russia-Ukraine war," FSC Vice Chairman Kim So-young said during the meeting, urging the financial authority and related key institutions to vigilantly watch the markets and to fully prepare necessary policy measures.
"As the increased volatility of the financial markets could affect vulnerable financial companies, lenders and the financial system as a whole, there should be frequent inspections on the financial sector's capital and liquidity soundness to prevent further risks," the FSC vice chief added.
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| Key officials from the Financial Services Commission (FSC), the Financial Supervisory Service (FSS) and the Korea Center for International Finance (KCIF) attend a market monitoring meeting held at the Seoul government complex, Tuesday morning. Courtesy of FSC |
The Bank of Korea (BOK) also held a market monitoring meeting earlier in the day, discussing global financial markets' situations and their impact on the Korean market.
"Amid growing concerns that the U.S. Fed might take a stronger-than-expected measure to respond to the high inflation, it is expected that local financial and foreign exchange markets would also show increased volatility. The central bank will take necessary measures, while closely monitoring the situation," Lee Seung-heon, Deputy Governor of the BOK, said during the meeting.
On the same day, the finance ministry also held an emergency meeting at the Seoul government complex, stressing vigilant market monitoring so as to better respond to the current grave market conditions.
"In a word, a comprehensive crisis has started. What is more worrisome is that the situation is widely expected to continue," Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho said, adding that the "battle" won't be over in a month or two.
He said all policy measures should put priority on curbing inflation as it is the most crucial issue facing the real economy.
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