Choo Kyung-ho and Lee Chang-yong Meeting... Discussing Response Measures to Financial and Foreign Exchange Market Instability

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho and Bank of Korea Governor Lee Chang-yong are attending a breakfast meeting held at the Press Center in Jung-gu, Seoul, on the morning of the 16th of last month, posing for a commemorative photo. Photo by Kim Hyun-min kimhyun81@

Amid growing instability in domestic and international financial and foreign exchange markets, Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho met with Bank of Korea Governor Lee Chang-yong on the 14th to discuss response measures.

The Ministry of Economy and Finance announced that Deputy Prime Minister Choo visited the Bank of Korea in the morning and exchanged views on the financial market situation with Governor Lee.

With the U.S. inflation rate reaching 8.6%, the highest in 41 years, domestic and international financial markets fell into 'panic,' increasing concerns, which appears to have prompted the two leaders to meet.

As the U.S. Federal Reserve (Fed) is expected to take a 'giant step' (a 0.75 percentage point interest rate hike at once) at the Federal Open Market Committee (FOMC) regular meeting on the 14th-15th (local time), investor sentiment has weakened, and the dollar has strengthened.

On that day, the won-dollar exchange rate opened at 1,291.5 won, up 7.5 won from the previous day's closing price, and rose to 1,292.5 won, surpassing the intraday high of 1,291.5 won set on May 12.

The KOSPI continued to decline in early trading that day, falling below the 2,500 mark for the first time in about 1 year and 7 months since November 13, 2020. As recession concerns have intensified and investor sentiment has weakened, volatility is expected to increase until the FOMC meeting.

The Bank of Korea also held an emergency market situation review meeting chaired by Deputy Governor Lee Seung-heon on the same day. Deputy Governor Lee said, "We will closely monitor future market conditions and actively intervene to stabilize the market when necessary."

Earlier, Deputy Prime Minister Choo and Governor Lee held an official meeting on the 16th of last month and agreed to strengthen policy coordination regarding foreign exchange and financial market instability.

At that time, Deputy Prime Minister Choo said, "The central bank governor and the deputy prime minister for the economy will continue to meet frequently to discuss economic matters so that their meetings do not become news."

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