South Korean Finance Minister: Will closely monitor the government bond market; the Korean won exchange rate faces bidirectional risks

(1) The South Korean Finance Minister stated in a meeting with financial officials that long-term government bond yields in major economies such as the United States, Japan, and Europe have reached their highest levels in decades, affected by increased fiscal spending and uncertainty in the Middle East. The government will closely monitor the issuance and trading of government bonds and strive to reduce financing costs for enterprises and households. (2) This week, the Korean won-to-US dollar exchange rate fell to 1300 for the first time (previously near 1550 in early July), mainly driven by South Korea’s record current account surplus. (3) In view of geopolitical tensions in the Middle East and monetary policies of major economies, the exchange rate faces both positive and negative risks. The government will remain vigilant and respond to market fluctuations.