South Korea's finance chief warns won's volatility remains high, vows swift action

SEOUL, January 08 (AJP) - South Korea’s deputy prime minister and finance minister Koo Yun-cheol said on Thursday that volatility in the foreign exchange market “remains high," pledging swift follow-up measures to stabilize overall conditions.

Koo made the remarks at a policy coordination meeting attended by Bank of Korea Governor Lee Chang-yong, Financial Supervisory Service Governor Lee Chan-jin and Financial Services Commission Vice Chairman Kwon Dae-young.

He said the current exchange rate appeared to be diverging from economic fundamentals and stressed the need for authorities to maintain “firm and consistent” policy responses.

Koo said equity and financial markets have remained buoyant, citing foreign investor inflows, while government bond yields have stayed stable, leaving overall market conditions “generally stable.”

However, he warned that downside risks persist in global markets, pointing to geopolitical uncertainty and shifts in monetary policy by major economies. Authorities will maintain a 24-hour market monitoring system and closely track external developments, he said.

Koo also said the government would step up so-called productive finance to channel funding toward advanced industries as well as venture and startup firms.

* This article, published by Aju Business Daily, was translated by AI and edited by AJP.