US 'Giant Step'... Party and Government to Discuss 'Seomin Financial Measures' on 6th

Sung Il-jong, Chairman of the Policy Committee of the People Power Party, is delivering opening remarks at the 'Comprehensive Measures for Narcotics Control' party-government meeting held at the National Assembly on the 26th. Photo by Yoon Dong-joo doso7@

[Asia Economy reporters Lee Ji-eun and Kwon Hyun-ji] The U.S. Federal Reserve (Fed) implemented a 'giant step' by raising the benchmark interest rate by 0.75 percentage points on the 2nd, prompting the ruling party and government to meet on the 6th to discuss measures for low-income financial support.

Seong Il-jong, Policy Committee Chairman of the People Power Party, said at the party's floor strategy meeting on the morning of the 4th, "As the U.S. Fed has taken a giant step by raising the benchmark interest rate by 0.75 percentage points, the gap with domestic interest rates has widened to 1 percentage point, increasing the possibility of a domestic benchmark rate hike."

He expressed concern, saying, "There are expectations that mortgage loan interest rates could reach 8% next year," and added, "If someone borrows 400 million won with a 30-year mortgage at a 4% interest rate, and the annual interest rate rises to 8%, they would have to repay nearly 3 million won per month."

Chairman Seong emphasized concerns over consumption contraction due to high interest rates, stating, "Above all, there is a shared recognition that urgent measures for low-income financial support are needed, so we decided to hold a ruling party-government meeting this coming Sunday."

The ruling party and government will discuss easing the requirements for the Safe Conversion Loan and other existing measures to reduce the financial burden on low-income households, activation of refinancing loans, financial market monitoring, and measures for the livelihood market.

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