ID :
202959
Tue, 08/23/2011 - 11:35
Auther :
Shortlink :
https://oananews.org//node/202959
The shortlink copeid
S. Korea's financial market more resistant to external shocks
SEOUL, Aug. 23 (Yonhap) -- South Korea's financial market has become more resistant to external shocks with its key stock index and foreign exchange less volatile compared to the past, data showed Tuesday.
Data provided by the Bank of America Merrill Lynch (BoA-Merrill Lynch) and Morgan Stanley both showed the local market better absorbing overseas developments compared to late 2008 when the country struggled to cope with the global financial crisis, the Korea Center for International Finance (KCIF) said.
It claimed such resilience reflects efforts made to enhance the macroeconomic soundness of the national economy.
The KCIF said that the BoA-Merrill Lynch's volatility index (VIX) showed South Korea's bourse and exchange rates fluctuating less, which helped stabilize market uncertainties.
The think tank, jointly run by the finance ministry and central bank, added that the latest VIX readings indicated more long term overseas investments were coming into South Korea and that sound fiscal policies taken by Seoul were all having positive effects.
The assessment said that because local institutional investors, such as the national pension fund, bought up stocks sold by foreign investors, the benchmark KOSPI fell less and was able to recover more quickly.
While the U.S. dollar rose against the Korean won 17.7 percent from Oct. 5 through Oct. 24 of 2008, gains reached just 2.9 percent from July 29 to Aug. 9 this year.
The Morgan Stanley report said South Korea's resilience stemmed from its global trade competitiveness and successful diversification of its export markets.
The investment bank claimed that because the government is expected to take steps to bolster the economy ahead of next year's general and presidential elections, this could lead to an improvement in the job market down the line.
But the report also warned that because private consumption could fall off sharply this year, South Korea's economic growth may reach 4.0 percent in 2011 and 3.6 percent in 2012. Originally, the investment bank forecast South Korea's economy would grow 4.5 percent this year and 3.6 percent next year.
yonngong@yna.co.kr
Data provided by the Bank of America Merrill Lynch (BoA-Merrill Lynch) and Morgan Stanley both showed the local market better absorbing overseas developments compared to late 2008 when the country struggled to cope with the global financial crisis, the Korea Center for International Finance (KCIF) said.
It claimed such resilience reflects efforts made to enhance the macroeconomic soundness of the national economy.
The KCIF said that the BoA-Merrill Lynch's volatility index (VIX) showed South Korea's bourse and exchange rates fluctuating less, which helped stabilize market uncertainties.
The think tank, jointly run by the finance ministry and central bank, added that the latest VIX readings indicated more long term overseas investments were coming into South Korea and that sound fiscal policies taken by Seoul were all having positive effects.
The assessment said that because local institutional investors, such as the national pension fund, bought up stocks sold by foreign investors, the benchmark KOSPI fell less and was able to recover more quickly.
While the U.S. dollar rose against the Korean won 17.7 percent from Oct. 5 through Oct. 24 of 2008, gains reached just 2.9 percent from July 29 to Aug. 9 this year.
The Morgan Stanley report said South Korea's resilience stemmed from its global trade competitiveness and successful diversification of its export markets.
The investment bank claimed that because the government is expected to take steps to bolster the economy ahead of next year's general and presidential elections, this could lead to an improvement in the job market down the line.
But the report also warned that because private consumption could fall off sharply this year, South Korea's economic growth may reach 4.0 percent in 2011 and 3.6 percent in 2012. Originally, the investment bank forecast South Korea's economy would grow 4.5 percent this year and 3.6 percent next year.
yonngong@yna.co.kr
