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☆ South Korea's producer price inflation slows to near 2-year low
▼ + stars: | 2023-02-22 | by ( ) www.reuters.com time to read: 1 min

SEOUL, Feb 23 (Reuters) - South Korea's producer price inflation slowed for a seventh straight month to its lowest in 22 months, central bank data showed on Thursday. The producer price index rose 5.1% in January from a year earlier, while it had climbed 5.8% in December, according to the Bank of Korea. The annual rate continued its slowing trend for a seventh straight month, after hitting a near 14-year high of 10.0% in June 2022. The index rose 0.4% over a month, however, after two straight months of declines, driven mostly by higher utility costs. Reporting by Jihoon Lee Editing by Vinay DwivediOur Standards: The Thomson Reuters Trust Principles.

Asian stocks are on course for their fourth down week in a row, the MSCI World index and the S&P 500 are eyeing their biggest weekly fall this year, and U.S. breakeven inflation rates are sailing up to 2.50% and beyond. A lower oil price, of course, is disinflationary, and base effects right now also mean that Brent crude is 17% cheaper today than it was a year ago. chartMinutes from the Fed's Jan. 31 to Feb. 1 policy meeting showed that most rate-setters voted to slow the pace of tightening. The Bank of Korea is expected to leave interest rates on hold at 3.50% on Thursday, and leave it there for the rest of the year, according to a Reuters poll. Consumer price inflation in January was 5.20%, well over double the central bank's 2.00% target and unlikely to return there for at least another year, economists reckon.

☆ South Korea's 'jeonse' rent-free renters hit by property downturn
▼ + stars: | 2023-02-21 | by ( Jihoon Lee | ) www.reuters.com time to read: +4 min

[1/2] Yoo Ha-jin, 27, looks at a building where she lives in Seoul, South Korea, February 21, 2023. Yoo Ha-jin, 28, regrets not getting insurance for her jeonse deposit when she signed in March 2021. "I thought I would be just fine as long as I could get a jeonse deposit loan from the bank," Yoo told Reuters. Jeonse deposit loans more than quadrupled in less than six years through October to 172 trillion won ($132 billion), according to the central bank. Jeonse deposit loansPROPERTY FALLOUTStill, almost all jeonse loans have guarantees from public enterprises, leaving little credit risk for commercial lenders.

☆ Bank of Korea to hold rates despite still high inflation: Reuters Poll
▼ + stars: | 2023-02-21 | by ( Anant Chandak | ) www.reuters.com time to read: +2 min

BENGALURU (Reuters) - The Bank of Korea will hold its base interest rate at 3.50% on Thursday and for the rest of this year, suggesting its longest tightening cycle on record is over despite still high inflation, a Reuters poll of economists found. FILE PHOTO: The logo of the Bank of Korea is seen on the top of its building in Seoul, South Korea, July 14, 2016. All 42 economists polled Feb. 13-20 predicted no change to the 3.50% base rate, already the highest since late 2008, at the central bank’s Feb. 23 meeting. Only a few respondents expected rates to climb above 3.50% at some point this year, while nearly half expected at least one rate cut by year-end. “Towards the year-end, we expect inflation to converge towards the BOK’s medium-term goal, which would therefore open up the room for the BOK to start cutting rates to bring policy into more neutral territory,” Derrick Kam, Asia economist at Morgan Stanley, said.

☆ S.Korea's household credit falls for first time in a decade
▼ + stars: | 2023-02-21 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Feb 21 (Reuters) - South Korea's household credit shrank in the fourth quarter of 2022, its first quarterly decline in nearly a decade, central bank data showed on Tuesday. The country's total household credit fell 0.2%, or 4.1 trillion won ($3.16 billion), in the fourth quarter from the previous quarter, to 1,867.0 trillion won by the end of December, according to the Bank of Korea. The quarterly decline was the first since the January-March quarter of 2013 and the biggest percentage fall since the first quarter of 2009. On an annual basis, the total credit increased 0.2%, marking its slowest growth since data collection started in the fourth quarter of 2002. ($1 = 1,297.5000 won)Reporting by Jihoon Lee; Editing by Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.

☆ Bank of Korea to hold rates despite still high inflation - Reuters poll
▼ + stars: | 2023-02-21 | by ( Anant Chandak | ) www.reuters.com time to read: +3 min

SummarySummary Companies BOK to hold base rate at 3.50% at Feb. 23 meetingBENGALURU, Feb 21 (Reuters) - The Bank of Korea will hold its base interest rate at 3.50% on Thursday and for the rest of this year, suggesting its longest tightening cycle on record is over despite still high inflation, a Reuters poll of economists found. All 42 economists polled Feb. 13-20 predicted no change to the 3.50% base rate (KROCRT=ECI), already the highest since late 2008, at the central bank's Feb. 23 meeting. Only a few respondents expected rates to climb above 3.50% at some point this year, while nearly half expected at least one rate cut by year-end. We expect the first rate cut to materialise in 2024, when we expect inflation to settle around the 2% mark and the U.S. (Federal Reserve) to pivot." The BOK's stance differs from many other global central banks that are expected to carry on raising interest rates, including the Fed.

Feb 20 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever. U.S. markets are closed on Monday for Presidents Day so Asian activity and volumes will be lighter than usual. This could give traders some rare breathing space to reflect on the scorching rise in U.S. market-based rates and yields. The People's Bank of China is scheduled to set its lending benchmark interest rates on Monday morning. chartThe Reserve Bank of New Zealand is expected to scale back its tightening on Wednesday, and raise rates by half a percentage point to 4.75%.

☆ Take Five: A year of war in Ukraine
▼ + stars: | 2023-02-17 | by ( ) www.reuters.com time to read: +5 min

LONDON, Feb 17 (Reuters) - The coming week will mark a year since Russia invaded Ukraine. The war goes on, but the world, and the markets, are in a very different place from last February. 1/A YEAR OF WARSenior politicians and military leaders from around the globe meet in Germany this weekend, days before the anniversary on Feb. 24 of Russia's invasion of Ukraine - Europe's biggest conflict since World War Two. Moscow is ramping up its spring offensive, while Ukraine - armed with heavier and longer-range firepower from the West - gathers strength for a counter push. On the same day as the Ukraine anniversary - Feb. 24 - Ueda should offer clues on timing when he testifies with his two would-be deputies to the lower house.

☆ South Korea, Australia central banks renew currency swap agreement
▼ + stars: | 2023-02-06 | by ( ) www.reuters.com time to read: 1 min

[1/2] The logo of the Bank of Korea is seen on the top of its building in Seoul, South Korea, March 8, 2016. REUTERS/Kim Hong-Ji/File PhotoSEOUL, Feb 6 (Reuters) - South Korea's central bank said it renewed on Monday a currency swap agreement with its Australian counterpart, valued at 9.6 trillion won or A$12 billion, for five years until early 2028. The agreement, first signed in 2014, allows either party to exchange funds in own currency for the other currency under pre-set terms. The Bank of Korea and the Reserve Bank of Australia have since renewed the agreement several times. ($1 = 1,246.9200 won)($1 = 1.4432 Australian dollars)Reporting by Choonsik Yoo; Editing by Subhranshu SahuOur Standards: The Thomson Reuters Trust Principles.

☆ South Korea Jan inflation ticks up, leaves policy outlook steady
▼ + stars: | 2023-02-01 | by ( Jihoon Lee | ) www.reuters.com time to read: +2 min

The annual rate of price rises was the highest since October, when it was 5.7%. Temporary effects that had pushed up inflation included a lift in electricity charges, unfavourable weather for vegetables and a strong round of regular annual price rises, the Finance Ministry said in a statement. A breakdown of the data showed January public utility costs had risen 4.6% from the previous month while agricultural products had jumped 6.2%, leading the index higher. The Bank of Korea said in a separate statement that the tick-up in the inflation rate was in line with its expectations. The annual rate would be just as high in February, around 5%, it said.

Playing down the economic slowdown as part of a global trend, Finance Minister Choo Kyung-ho pledged prompt support measures for exporters, such as tax breaks and administrative help. Central bank estimates showed gross domestic product (GDP) shrank 0.4% in the October-December period from the previous quarter. Markets showed a muted reaction to the data, which was largely in line with repeated warnings in recent weeks by the government and central bank. The central bank estimated that in 2022 the full-year value of the economy, Asia's fourth-largest, had been 2.6% larger than in 2021, when it showed growth of 4.1%. Reporting by Jihoon Lee and Choonsik Yoo; Editing by Bradley PerrettOur Standards: The Thomson Reuters Trust Principles.

☆ Bank of Korea could have one more 25 basis point interest rate hike, Goldman Sachs says
▼ + stars: | 2023-01-26 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailBank of Korea could have one more 25 basis point interest rate hike, Goldman Sachs saysGoohoon Kwon of the investment bank says there's strong indication that the Bank of Korea is approaching the end of its interest rate hike cycle.

☆ South Korea's economy shrank for the first time in two years, but growth is expected from China’s reopening
▼ + stars: | 2023-01-26 | by ( Jihye Lee | ) www.cnbc.com time to read: +1 min

A customer looks at a pack of frying mix at a supermarket in Seoul on May 14, 2020. South Korea's economy saw its first quarterly contraction since the second quarter of 2020, according to advance estimates released by the central bank. The worsening conditions in South Korea's economy signaled that a recovery, once seen coming from "revenge-spending" consumers putting the pandemic behind them, may be fading sooner than expected. A sharp, 5.8% decline in exports dragged down the overall reading, alongside a 4.1% drop in manufacturing and 0.4% contraction in private consumption, the central bank said in its release. Still, South Korea's benchmark Kospi stock index continued to show gains for a fourth consecutive session on Thursday, trading 0.7% higher in the afternoon.

☆ South Korea Q4 GDP shrinks 0.4% q/q, worse than expected
▼ + stars: | 2023-01-25 | by ( ) www.reuters.com time to read: 1 min

SEOUL, Jan 26 (Reuters) - South Korea's economy contracted in the final quarter of 2022 for the first time in 2-1/2 years, as a post-pandemic spending spree faded and global trade tumbled, central bank estimates showed on Thursday. Gross domestic product (GDP) shrank 0.4% in the October-December period from the previous quarter, the Bank of Korea estimated, after a 0.3% gain in the July-September quarter. South Korea's economy last contracted in the second quarter of 2020. Fourth-quarter 2022 GDP was 1.4% higher than a year earlier, compared with a 3.1% annual gain seen in the third quarter and the 1.5% forecast in the poll. Reporting by Jihoon Lee and Choonsik Yoo; Editing by Bradley PerrettOur Standards: The Thomson Reuters Trust Principles.

☆ South Korea's Q4 GDP likely shrank, hints at possible recession - Reuters poll
▼ + stars: | 2023-01-20 | by ( Veronica Dudei Maia Khongwir | ) www.reuters.com time to read: +3 min

Asia's fourth-largest economy is expected to have shrunk by a seasonally-adjusted 0.3% in the October-December quarter after growing 0.3% in the preceding period. All but one of 13 economists in the Jan. 16-19 Reuters poll forecast a contraction, with the other expecting growth to flatline. If realized, it would be the sharpest contraction since mid-2020 when the COVID-19 pandemic was cementing its grip on the world. On a year-on-year basis, gross domestic product (GDP) likely grew 1.5% in the fourth quarter, the median forecast of 21 economists showed, half the 3.1% growth in the third quarter. According to a separate Reuters poll, growth was forecast at 2.5% in 2022, slowing to 1.9% this year.

☆ Bank of Korea raises interest rates by 25 bps, as expected
▼ + stars: | 2023-01-13 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Jan 13 (Reuters) - South Korea's central bank raised its policy interest rate by 25 basis points on Friday, making a widely expected move that many economists also predicted would mark the end of a tightening cycle that began in 2021. The Bank of Korea said its seven-member monetary policy board had decided to raise its policy interest rate (KROCRT=ECI) to 3.50%, the highest since December 2008. The rise matched a prediction by 36 out of 40 economists in a Reuters poll, in which the remaining four had expected the central bank to hold the rate steady at 3.25%. Friday's decision marked the 10th interest rate rise since the current tightening cycle began in August 2021 and brought the total amount of increase to 300 basis points. Reporting by Choonsik Yoo and Jihoon Lee; Editing by Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.

Economists in a Reuters poll had predicted Friday's rate increase would mark the end of a rate-hike cycle that the Bank of Korea's began in late 2021. The Bank of Korea said its seven-member monetary policy board had decided to raise its policy interest rate (KROCRT=ECI) to 3.50%, the highest since late 2008. The interest-rate rise matched a prediction by 36 out of 40 economists in a Reuters poll, in which the remaining four had expected the central bank to hold the rate steady at 3.25%. The decision follows Governor Rhee Chang-yong's remarks this month that the central bank's policy stance would continue to focus on stabilising prices. Like its peers globally, the Bank of Korea is faced with growing pressure to adjust its policy stance as domestic consumer and corporate spending fades and global trade slows.

U.S. inflation data for December is in, and while market reaction was perhaps a little muted relative to recent releases and the hype surrounding it, the overriding message for investors was clear: keep calm and risk on. Given that some of the biggest intraday moves in financial markets last year were on U.S. inflation days, the reaction on Thursday wasn't explosive. A stunning 30-year U.S. Treasury auction helped push bond yields down further, fueling investors' appetite to go out across the risk curve. A Reuters poll on Thursday showed that investors are already adding to their long positions in Asian currencies. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ South Korea Dec import price growth slowest in 21 months
▼ + stars: | 2023-01-12 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Jan 13 (Reuters) - South Korea's import prices rose at their slowest pace in 21 months in December, as the local won currency strengthened and oil prices fell, implying weakening pressure on consumer inflation. It marked the slowest annual rise since March 2021. Those of exports also rose at a slower rate of 3.1%, down from 8.3% in the previous month, and marked the slowest since February 2021, also affected by a stronger won. In December, the dollar/won exchange rates were on average 5.0% lower than in November, while Dubai oil prices were 10.5% lower, according to the Bank of Korea. Reporting by Jihoon Lee; Editing by Toby ChopraOur Standards: The Thomson Reuters Trust Principles.

☆ Bank of Korea working hard to ensure economy's soft landing -governor
▼ + stars: | 2023-01-03 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Jan 3 (Reuters) - South Korea's central bank governor said on Tuesday the bank will do its best to ensure a soft landing for the economy amid significant internal and external uncertainty. "The Bank of Korea, together with the government, will do its best in making sophisticated policy responses to achieve a soft landing of the South Korean economy, during this time of clouded visibility due to considerable external and internal uncertainties," Governor Rhee Chang-yong said in a speech at a New-Year event. Rhee said the central bank will pay attention to growth and changes in financial and foreign exchange markets, while continuing to focus its monetary policy stance on stabilising prices. The Bank of Korea (BOK) will hold its first rate decision meeting for this year on Jan. 13, having raised interest rates by 275 basis points to 3.25% since August 2021. Reporting by Jihoon Lee; Editing by Christopher CushingOur Standards: The Thomson Reuters Trust Principles.

☆ Bank of Korea chief sees more conflict between goals
▼ + stars: | 2023-01-01 | by ( ) www.reuters.com time to read: 1 min

SEOUL, Jan 1 (Reuters) - The head of South Korea's central bank said on Sunday it would likely face an increasing conflict between policy goals in 2023 as the effect of the recent aggressive policy tightening materialises in earnest. "It will be a year when a sophisticated policy mix is more important than ever due to a growing possibility of conflict between inflation, economic growth and financial stability," Governor Rhee Chang-yong said in his New Year's address. He said a fast cooling of the real estate market could cause financial market instability, while listing the war in Ukraine and the COVID-19 situation in China as the main sources of uncertainty facing the country's economy and inflation. Reporting by Choonsik Yoo; Editing by Alison WilliamsOur Standards: The Thomson Reuters Trust Principles.

☆ South Korea Dec inflation steady at 5.0%, as expected
▼ + stars: | 2022-12-30 | by ( Reuters Staff | ) www.reuters.com time to read: +2 min

REUTERS/ Heo RanSEOUL (Reuters) - South Korea’s consumer prices in December rose 5.0% from a year earlier, official data showed on Friday, matching market expectations and the pace seen in November. A breakdown of the data showed prices of agricultural products had been 1.6% lower than in December 2021. But utility prices jumped 23.2% and private service prices 6.0%, keeping the overall annual inflation rate high. The fall in the core annual rate in December was the first since November 2021. No year-average inflation rate has been so high since 1998.

☆ South Korean inflation expectations hit 7-month low
▼ + stars: | 2022-12-26 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Dec 27 (Reuters) - A major measure of the inflation expectations of South Korean consumers hit a seven-month low in December, underscoring the market's view that the Bank of Korea's policy tightening cycle is nearing an end. Consumers expected inflation for the next 12 months to be a median 3.8%, the Bank of Korea's monthly survey showed, down from 4.2% in November and the lowest since 3.3% in May. The Bank of Korea was among the first major economy central banks to begin raising interest rates, in August last year, and has up to November, raised its policy rate by a total of 275 basis points in nine steps to 3.25%. In the latest Reuters poll, the majority of analysts expected the Bank of Korea to raise the rate once again in early 2023, to 3.5%, and then stop its tightening cycle. Reporting by Choonsik Yoo; Editing by Robert BirselOur Standards: The Thomson Reuters Trust Principles.

☆ South Korea's FX reserves post biggest monthly gain in 13 on weaker dollar
▼ + stars: | 2022-12-04 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Dec 5 (Reuters) - South Korea's foreign exchange reserves increased in November for the first time in four months and by the largest amount in 13 months, central bank data showed on Monday, as the U.S. dollar retreated from a two-decade high scaled in October. The country's FX reserves stood at $416.10 billion at the end of November, up $2.09 billion from $414.01 billion a month before, according to the Bank of Korea (BOK). The reserves increased in November by the largest amount since October 2021. Of the 13 months since then, they fell for 10 months, hitting a more than two-year low at the end of October this year. The U.S. dollar index fell 5.1% in November, the biggest monthly drop in more than 12 years.

☆ Bank of Korea's Rhee 'not so sure' about digital currencies
▼ + stars: | 2022-12-02 | by ( ) www.reuters.com time to read: +1 min

SEOUL, Dec 2 (Reuters) - South Korea's central bank governor Rhee Chang-yong said he became sceptical of the benefits of new technologies related to Central Bank Digital Currencies (CBDC), after recent events in the cryptocurrency market. "I was more positive before, but after seeing the Luna, Terra, and now the FTX issues ... I don't know (if) we will see the real benefit of this new technology, at least for monetary policy," said Rhee, a panelist at a session on digital currency. The market saw another rout last month, after one of the world's biggest crypto exchanges FTX filed for bankruptcy, with crypto lending company BlockFi following suit. Reporting by Jihoon Lee; Editing by Clarence FernandezOur Standards: The Thomson Reuters Trust Principles.

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