[Weekly Outlook] Impact of Ukraine-Origin Inflation Shock... Choo Kyung-ho Hearing to be Held on 2nd

Deputy Prime Minister and Minister of Economy and Finance nominee Choo Kyung-ho is arriving at the Presidential Transition Committee office in Tongui-dong, Jongno-gu, Seoul, on the morning of the 14th. Photo by Transition Committee Press Corps

[Asia Economy Sejong=Reporter Kwon Haeyoung] This week, attention is focused on how much more South Korea's inflation, which rose by over 4% due to the aftermath of the Ukraine crisis, has increased. The confirmation hearing for Choo Kyung-ho, the nominee for Deputy Prime Minister and Minister of Economy and Finance, is also in the spotlight.

According to Statistics Korea on the 1st, the consumer price trends for April will be announced on the 3rd. Consumer prices rose 4.1% in March, marking the first time in 10 years and 3 months since December 2011 (4.2%) that the inflation rate exceeded 4%.

The Bank of Korea will announce the foreign exchange reserves as of the end of April on the 4th. As of the end of March, South Korea's foreign exchange reserves stood at $457.81 billion, down $3.96 billion from the end of February ($461.77 billion). This was due to the dollar's strength (rise in dollar value) reducing the dollar-converted value of foreign currency assets in other currencies, as well as foreign exchange market volatility mitigation measures (market intervention). Given that the won-dollar exchange rate has continued to rise due to the strong dollar, attention is on whether foreign exchange reserves decreased further last month.

The confirmation hearing for Choo Kyung-ho, nominee for Deputy Prime Minister and Minister of Economy and Finance, is also scheduled for the 2nd. Questions are expected regarding the supplementary budget (Chugyeong) for compensating losses of small business owners, measures to curb rapid inflation, and directions for real estate policy.

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