Latest news with #BOK
Korea Herald
2 hours ago
- Business
- Korea Herald
BOK vows 'swift' market stabilization measures amid Middle East crisis
The United States' military involvement in the Middle East has heightened market uncertainties, the South Korean central bank said Monday, vowing to take "appropriate market stabilization measures" in a timely manner, if necessary. The assessment came as US President Donald Trump said his country's military conducted precision strikes on three key nuclear facilities in Iran over the weekend, exacerbating the crisis in the Middle East and sparking concerns about its impact on the global markets. "Given that US military involvement has significantly heightened uncertainty in the Middle East, we will maintain a high level of vigilance and closely monitor developments in the situation and their impact on domestic and global financial and economic conditions through a 24-hour monitoring system," Bank of Korea Deputy Gov. Yoo Sang-dai said during an emergency task force meeting on the matter. "If market volatility becomes excessively amplified, appropriate market stabilization measures will be implemented in a timely manner," he added. During the meeting, officials assessed that uncertainties surrounding the global economy and inflation could increase due to the instability in global oil prices, and that global risk aversion sentiment could be further heightened, according to the BOK. (Yonhap)
Bloomberg
5 days ago
- Business
- Bloomberg
BOK Warns of Inflation Risks From US Tariffs, Israel-Iran Crisis
While South Korea's inflation has stabilized near the central bank's 2% target, US tariffs and the Israel-Iran conflict are adding uncertainty to the outlook, according to the Bank of Korea. Households also remain burdened by high costs of essentials like food and housing, the BOK said in a semiannual review of inflation published Wednesday. Structural factors, such as housing price imbalances between metropolitan areas in Seoul versus the rest of the country, are keeping living costs high compared with other major economies, the central bank said.
Korea Herald
06-06-2025
- Business
- Korea Herald
Political uncertainty falls below pre-martial law levels: BOK
The level of political uncertainty in South Korea has returned to levels seen prior to the martial law incident, following the recent presidential election, the central bank said Friday. According to data submitted by the Bank of Korea to Rep. Cha Gyu-geun of the Rebuilding Korea Party, the political uncertainty index stood at 1.5 as of June 4, the day after the election, in which Democratic Party candidate Lee Jae-myung defeated conservative rival Kim Moon-soo. The index, which had been around 0.4 in early December, spiked to a record high of 12.8 in mid-December, following former President Yoon Suk Yeol's surprising declaration of martial law on Dec. 3. Though the index rose slightly above 1 after the election, the BOK noted that such minor fluctuations are common in normal times and should not be interpreted as meaningful. The index is compiled by the BOK's research department by tallying the number of media articles that include both the keywords "politics" and "uncertainty" in their headlines or main text. It reflects relative values, with the long-term average from the beginning of 2000 set at zero, the BOK said. The previous record high was 8.8, recorded on March 17, 2004, following the passage of the impeachment motion against the late former President Roh Moo-hyun. The economic uncertainty index also fell to 1.2 as of June 4, a level similar to the 1.1 recorded on Dec. 3. The index had surged to 5.4 on Jan. 2 but gradually declined, reaching as low as 0.5 on May 15, the BOK said. "The political uncertainty that has weighed on the economy over the past six months is expected to ease significantly," BOK Gov. Rhee Chang-yong said at a press briefing last week. "Political factors are no longer having a meaningful impact on the won-dollar exchange rate." The Korean won had weakened sharply earlier this year, nearing 1,500 won per US dollar, largely due to the domestic political turmoil and concerns over the sweeping tariff measures under US President Donald Trump's administration. But it rebounded to its strongest level in about seven months Thursday, closing at 1,358.4 won per dollar. (Yonhap)
Korea Herald
05-06-2025
- Business
- Korea Herald
S. Korea's economy shrinks 0.2 pct in Q1, unchanged from earlier estimate: BOK
The South Korean economy contracted 0.2 percent in the first quarter of this year, unchanged from an earlier estimate, central bank data showed Thursday, due mainly to a domestic political crisis and uncertainties stemming from U.S. President Donald Trump's administration's aggressive tariff scheme. The country's real gross domestic product (GDP) -- a key measure of economic growth -- contracted 0.2 percent in the January-March period from three months earlier, which marked the first negative growth in nine months, according to the preliminary data from the Bank of Korea (BOK). The South Korean economy had expanded 1.3 percent in the first quarter of 2024 but slipped into contraction in the second quarter with a 0.2 percent decline before posting 0.1 percent growth in both the third and fourth quarters. The negative growth came as former President Yoon Suk Yeol's imposition of martial law on Dec. 3 and the subsequent political chaos dampened domestic demand. The U.S.' sweeping tariff scheme has also affected the trade-dependent South Korean economy. Trump announced reciprocal tariffs, including a 25 percent levy on South Korean goods, though implementation was later postponed for 90 days. Trade negotiations are currently under way between South Korea and the United States, with the two sides aiming to reach a "package" agreement on trade and related issues by July 8, when the 90-day suspension of U.S. tariffs will end. Last week, the central bank sharply lowered its outlook for South Korea's economic growth this year to 0.8 percent from its previous forecast of 1.5 percent, citing sagging consumption and slowing export growth amid uncertainties stemming from Washington's tariff measures. (Yonhap)
Coin Geek
04-06-2025
- Business
- Coin Geek
South Korea mulls deposit tokens on public blockchains
Getting your Trinity Audio player ready... South Korea's central bank is weighing launching deposit tokens on public blockchains to better compete with stablecoins, local media reports. Speaking at the 8th Blockchain Leaders Club in Seoul, Lee Jong-ryeol, the deputy governor of the Bank of Korea (BOK), revealed that the regulator is considering 'a plan to link [our] deposit tokens with the public blockchain network.' Jong-ryeol described the new token as 'a type of stablecoin issued within the digital currency system built and operated by the Bank of Korea.' This would make it a centralized token under the control of the bank. However, the central banker added that BOK is weighing integrating the token with stablecoins issued by the private sector. The central bank says the token could enable it to 'safely and soundly develop the digital currency ecosystem from a national perspective,' he added. Jong-ryeol was scant on details such as whether the bank would limit access to the tokens and if they would be available to users beyond South Korea. Naturally, if they were availed on a public blockchain, the central bank would cede control over the tokens and they would trade freely across borders. In such a scenario, the tokens would be more like stablecoins, but with the BOK as the issuer. This would make the bank the first in the world to compete with private issuers like Circle and Tether, which dominate the market. While the project has baffled many experts, who are still unsure how it will be implemented, it is little surprise that the top bank is exploring alternatives in response to the rise of United States dollar-pegged stablecoins. Being one of the largest digital asset markets, South Korea has recorded a parabolic rise in the use of stablecoins in 'crypto' trading and beyond. One local outlet revealed that in Q1, Koreans transferred 27 trillion ($20 billion) in stablecoins to offshore addresses, accounting for half the total digital asset value. With stablecoins still a nascent field for most central banks, BOK is among those rushing to devise a solution that allows it to prevent crime and implement monetary policies. Some, like the European Union, have prohibited the use of stablecoins that are not licensed and regulated in the region. Others, like the United Kingdom and the United Arab Emirates, require stablecoin issuers to obtain payment licenses and adhere to industry standards. Still, South Korea's response is the most unique as it would pit a central bank directly against the private sector. But then again, the Israeli central bank has proposed paying interest on its central bank digital currency (CBDC) to directly compete with commercial banks. Speaking to one news outlet, Peter Chung noted that it remains unclear how the BOK intends to operate the proposed system. Chung's Presto Labs operates an algorithmic trading platform. '…the way to protect monetary sovereignty is not by tinkering with token design or network architecture, but through sound monetary and fiscal policies,' he stated. Meanwhile, the Democratic Party of Korea (DPK) is ramping up advocacy for a won-pegged stablecoin. The party has targeted digital asset owners with pledges of better regulation in the leadup to the June 3 elections, including local stablecoins to compete with USDT and USDC, which dominate the Korean market. Thailand eyes' crypto' payments for tourists In Thailand, the government plans to enable digital asset payments for tourists following a limited trial earlier this year. The Thai Ministry of Finance revealed that it's working on a plan that will allow tourists holding digital assets to make direct payments via debit and credit cards while purchasing local goods and services. The local merchants would receive the payments in the Thai baht and would not need to know that digital assets have been involved. The new initiative is under consideration by the Bank of Thailand (BOT) but has yet to receive a green light. It would also require some vital infrastructural changes, the ministry acknowledged. 'In some foreign countries, it's already possible to use crypto for purchases by linking it to credit cards,' Finance Minister Pichai Chunhavajira stated in his speech at a local financial industry event. 'This approach can be immediately adapted for Thailand, provided the supporting systems are in place, but it will not involve our domestic currency.' In January, Pichai announced a pilot program that allowed foreign tourists to pay in digital currencies in Phuket, the country's main tourist destinations. Watch: Blockchain is much more than digital assets title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen>
