The economic policymakers of South Korea on Monday promised to stabilize the currency market, as the recent losses of the won were not in line with the economic fundamentals.
Finance Minister Koo Yun-cheol said in remarks prepared for a New Year’s event that “We will closely monitor financial and foreign exchange markets and make efforts to resolve the structural demand-supply imbalance in the foreign exchange market.”
The won was dropped 0.3 percent at 1,448.6 a dollar on Monday, continuing a loss for a fourth straight session, after a sharp rebound in late December from eight-month lows on policy efforts to reverse the trend.
Koo also added that the government would be ready to give tax incentives for long-term investment in domestic stocks.
During the event organized to discuss the financial sector, Bank of Korea Governor Rhee Chang-yong noted that the central bank and the government, along with the other relevant agencies, needed to collaborate to deal with the recent declining trends in the won, which would not fit the economic fundamentals.
In an outlook, Rhee indicated that monetary policy would be run in a more delicate manner since bigger trade-offs would exist in weighing growth, inflations and financial stability.
