[Weekly Outlook] Yoon Administration's First Real Estate Policy to Be Announced... Focus on Whether Electricity Rates Will Increase

[Asia Economy Sejong=Reporter Son Seon-hee] Next week, the Yoon Seok-yeol administration is expected to announce its first real estate measures focusing on 'supplementing the lease market.'

According to related ministries, the government will hold a real estate-related ministers' meeting chaired by Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho on the 21st to announce measures to ease the burden on jeonse and monthly rent users in the lease market. It is known that the approach will be to partially supplement rather than completely overhaul the three lease laws (Jeonse and Monthly Rent Reporting System, Jeonse and Monthly Rent Cap System, and Contract Renewal Request Right).

Deputy Prime Minister Choo recently stated, "Artificial regulations like the three lease laws and policies somewhat contrary to market order should never have been created," but added, "It would be good if this system disappears quickly, but if it is reversed all at once, there could be significant confusion in the market, so immediate abolition is difficult."

On the same day, the government is also expected to announce whether electricity rates will be increased. Korea Electric Power Corporation (KEPCO) requested a third-quarter electricity rate hike from the government on the 16th. The fuel cost adjustment rate can be increased or decreased by up to ±3 KRW per kWh compared to the previous quarter, and KEPCO insists that the maximum increase of 3 KRW is necessary.

Electricity rates are decided through consultations between the Ministry of Trade, Industry and Energy, which oversees the sector, and the Ministry of Economy and Finance, which manages prices. However, with prices soaring rapidly due to rising oil prices, an increase in electricity rates would inevitably add to the burden on the public.

The Bank of Korea will release the 'Financial Stability Report (as of June)' on the 22nd. It is expected to include the status of private sector credit (debt) for households and businesses. Attention is focused on whether the growth in private credit has slowed amid the interest rate hike period.

On the 23rd, the Producer Price Index for May will be announced. The index for April rose 1.1% compared to March due to factors such as rising raw material prices. It has increased for four consecutive months since January this year, and there is keen interest in whether the upward trend continued in May amid growing inflation concerns.

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