Securities Market Focuses on FOMC Minutes Release: "Confirming Tapering Timing"

[Asia Economy Reporter Lee Seon-ae] Amid last week's sharp decline in the domestic stock market, this week's market attention is expected to focus on the release of the July Federal Open Market Committee (FOMC) meeting minutes.

According to Ebest Investment & Securities on the 15th, the major market events this week (17th~20th) include the release of the FOMC minutes, the full-scale execution of Korea's second supplementary budget, and the South Korea-U.S. joint military exercises. Among these, the most noteworthy event is the release of the FOMC meeting minutes scheduled for the 18th.

Yeom Dong-chan, a researcher at Ebest Securities, said, "Since Jerome Powell, after the July FOMC, mentioned for the first time in this meeting an in-depth analysis of the timing, pace, and composition of tapering (asset purchase reduction), it is important to pay attention as we can check the opinions and atmosphere of Federal Reserve (Fed) members regarding the timing of tapering." He added, "Expectations are growing that there will be significant remarks about the tapering schedule at the Jackson Hole meeting scheduled for the end of August, while Robert Kaplan, president of the Dallas Fed and a representative hawk, has expressed the view that tapering should be announced in September and start in October."

On the 13th last week, the domestic KOSPI index closed lower influenced by the highlighted possibility of changes in the Federal Reserve's monetary policy. It closed at 3,171.29, down 37.09 points (1.16%). The last time the KOSPI index closed below the 3,200 mark was on May 28 (3,188.73). During the session, the decline widened to as much as 1.92%, reaching 3,146.76.

Meanwhile, the supplementary budget, the second largest ever at 34.9 trillion won, is set to be fully executed. It includes a three-package support plan consisting of disaster relief funds, small business damage support, and mutual consumption support, as well as regional economic revitalization, vaccines, and strengthened quarantine measures. In addition, the South Korea-U.S. joint military exercises will begin in earnest from the 16th.

This content was produced with the assistance of AI translation services.