“It is not unreasonable to achieve a current account surplus this year, but there is a possibility of a scale down… Strict response to market disturbances”
Government, emergency macroeconomic and financial meeting… Operation of joint response system during Chuseok holidays, real-time inspection of overseas markets
Deputy Prime Minister and Minister of Strategy and Finance Choo Kyung-ho announced on the 5th that he would closely look into the supply and demand of foreign exchange, including the capital flow of domestic and foreign people, predicting that the current account will be volatile for the time being.
Deputy Prime Minister Chu said at an emergency macroeconomic and financial meeting held at the Bank Hall in Seoul on the same day, “There is a possibility that the current account surplus may decrease in the future as the trade balance deteriorates due to the recent rise in international energy prices and slowdown in global demand such as China.”
Last month, the trade balance recorded a deficit of $9.47 billion, the largest deficit ever recorded since statistics were compiled in 1956.
The accumulated trade deficit from January to August was also the largest in history at $24.723 billion.
In the Seoul foreign exchange market on the 2nd, the won/dollar exchange rate broke through the 1,360 won per dollar level for the first time in 13 years and 4 months since the global financial crisis.
“The increase in volatility in the domestic financial market is mainly due to worsening external conditions,” said Deputy Prime Minister Chu. .
“In particular, the deteriorating trade balance and the weakening of the yuan in August overlapped the won/dollar exchange rate,” he said.
“Unlike the increased exchange rate level, external soundness indicators have maintained a stable level without major changes,” he said. .
Deputy Prime Minister Chu predicted that the current account will also achieve a significant surplus this year.
Deputy Prime Minister Chu said, “We will speedily pursue the strategy to strengthen export competitiveness and revitalize overseas infrastructure orders announced last week, and continue to seek ways to improve the overall trade structure.” We will continue to monitor and seek policy measures,” he said.
“Even during the Chuseok holiday, we will operate a joint response system with related institutions to monitor the overseas financial and foreign exchange markets and real economy in real time and respond quickly,” he added.
Regarding the slowdown in consumer price inflation last month, he said, “The inflation rate fell for the first time in 21 months compared to the previous month due to the fall in international oil prices and policy effects. “The high level continues, and there are concerns about the impact of bad weather such as typhoons following the rainy season,” he said.
He also said that he would focus his policy capabilities on stabilizing prices and people’s livelihoods.
The emergency macroeconomic and finance meeting was attended by Deputy Prime Minister Choo Kyung-ho, Bank of Korea Governor Lee Chang-yong, Financial Services Commission Chairman Kim Joo-hyun, Presidential Office Chief Economic Officer Choi Sang-mok, and Financial Supervisory Service Chairman Lee Bok-hyeon.
It is the first time in more than a month since July 28 that an emergency macroeconomic and financial meeting was held where the heads of economy and finance gather.
/yunhap news