News
S. Korea's central bank holds rate steady in first rate decision of 2025
2025/01/16 17:00
Policymakers at Seoul's central bank have decided to hold their benchmark interest rate steady at three percent. Our correspondent Lee Soo-jin tells us why. South Korea's central bank held its key interest rate steady at 3 percent, as the Korean won remains weak. The decision was announced on Thursday following the first monetary policy committee meeting of the year. "We decided that it would be appropriate to maintain the current rate while monitoring internal and external conditions as domestic political circumstances and changes in major countries' economic policies have increased uncertainties in terms of the economic outlook and foreign exchange markets." It's worth noting that the rate freeze decision comes after two consecutive quarter-point cuts in both the October and November monetary policy meetings last year after the key rate was frozen at 3-point-5 percent since January 2023 in a bid to tackle inflation. There was a lot of speculation in the markets before the decision was announced. A rate cut had been anticipated by some due to concerns about a downturn in the economy due to the ongoing political turmoil, as well as uncertainties over President-elect Donald Trump's second term. But the Bank of Korea ultimately decided to freeze the interest rate, due to a weaker Korean won against the greenback, and minutes from the U.S. Fed's December meeting where officials hinted they would be moving more slowly on interest rate cuts. If the interest rate gap between the two countries widens, it could lead to further currency depreciation. In December, the average won-dollar exchange rate stood at 1-thousand-4-hundred-thirty-four-point-4-2, a change of nearly 3-percent from an average of 1-thousand-3-hundred-ninety-three-point-3-8 in November. "So it might be better to leave the interest rate where it is right now and at least for the moment have government spending increase. I do not think inflation will be a serious problem this year." The country's annual consumer inflation rose by 2-point-3 percent in 2024, the lowest rate since the COVID-19 pandemic in 2020. As for its assessment of the domestic economy, the Bank of Korea forecasted sluggish economic growth this year, as exports are expected to weaken due to political uncertainties. "Acknowledging concerns about the domestic economy, the central bank hinted at possible rate cuts in the future and pledged to carefully monitor inflation and currency trends before making the decision. Lee Soo-jin, Arirang News."
S. Korea's central bank holds rate steady in first rate decision of 2025
2025/01/16 10:00
South Korea's central bank held its key interest rate steady on Thursday, as the Korean won remains weak. It announced the decision following the first monetary policy committee meeting of the year. The move, keeps the benchmark interest rate unchanged at 3-percent, and comes after two consecutive quarter-point cuts in both the October and November monetary policy meetings last year.
S. Korea's job market stumbles: December job decline marks weak end to 2024
2025/01/15 20:00
Employment here in Korea in 2024 rose by less than half the size of its growth in 2023. Our correspondent Moon Hye-ryeon tells us why. South Korea's job market saw a sharp decline in growth last year, with December marking the first employment figure decrease in more than three years amid political instability in the country. According to data released by Statistics Korea on Wednesday, the number of people in employment in 2024 increased by just 159-thousand compared to the previous year, reaching just under 28-point-6 million in total. This figure is less than half of the 327-thousand jobs added in 2023, highlighting a significant slowdown for the labor market. It also marks the smallest annual increase in employment since 2020, when the COVID-19 pandemic led to job losses. Job growth rebounded in 2021 and surged in 2022 to mark the biggest gain in 22 years – before declining in 2023 and again in 2024. The construction sector saw the largest decline, losing 49-thousand jobs – the steepest drop on record. Employment in wholesale and retail, as well as in manufacturing, also decreased. By age, employment growth was concentrated among older workers in 2024, with 266-thousand jobs added for those aged 60 and above. Meanwhile, the number of employed people in their twenties and forties fell sharply. In December alone, the number of those in employment fell by 52-thousand, which marked the first decline in more than three years. A spokesperson from the agency commented on whether these figures are reflective of weakened consumer demand due to the political instability following the December 3rd martial law declaration. "It can be said that sectors like wholesale and retail, transportation and warehousing, and accommodation and food services may have been influenced to some extent by psychological factors, showing a slowdown in these industries." With these latest figures, the government pledged to actively support the recovery of domestic demand and job creation through rapid execution of livelihood and economic support projects including job initiatives in the first half of the year. This came during a ministerial economic meeting headed by the country's Finance Minister on Wednesday – who went on to further urge all ministries to act as "dedicated employment departments" and prepare tailored job support measures for vulnerable citizens. Despite the slowdown, South Korea's employment rate for those aged 15 and older reached 62-point-7 percent, the highest since records began. Moon Hye-ryeon, Arirang News.
S. Korea's job market stumbles: December job decline marks weak end to 2024
2025/01/15 17:00
Employment here in Korea in 2024 rose by less than half the size of its growth in 2023. Our correspondent Moon Hye-ryeon tells us why. South Korea's job market saw a sharp decline in growth last year, with December marking the first employment figure decrease in more than three years amid political instability in the country. According to data released by Statistics Korea on Wednesday, the number of people in employment in 2024 increased by just 159-thousand compared to the previous year, reaching just under 28-point-6 million in total. This figure is less than half of the 327-thousand jobs added in 2023, highlighting a significant slowdown for the labor market. It also marks the smallest annual increase in employment since 2020, when the COVID-19 pandemic led to job losses. Job growth rebounded in 2021 and surged in 2022 to mark the biggest gain in 22 years – before declining in 2023 and again in 2024. The construction sector saw the largest decline, losing 49-thousand jobs – the steepest drop on record. Employment in wholesale and retail, as well as in manufacturing, also decreased. By age, employment growth was concentrated among older workers in 2024, with 266-thousand jobs added for those aged 60 and above. Meanwhile, the number of employed people in their twenties and forties fell sharply. In December alone, the number of those in employment fell by 52-thousand, which marked the first decline in more than three years. A spokesperson from the agency commented on whether these figures are reflective of weakened consumer demand due to the political instability following the December 3rd martial law declaration. "It can be said that sectors like wholesale and retail, transportation and warehousing, and accommodation and food services may have been influenced to some extent by psychological factors, showing a slowdown in these industries." With these latest figures, the government pledged to actively support the recovery of domestic demand and job creation through rapid execution of livelihood and economic support projects including job initiatives in the first half of the year. This came during a ministerial economic meeting headed by the country's Finance Minister on Wednesday – who went on to further urge all ministries to act as "dedicated employment departments" and prepare tailored job support measures for vulnerable citizens. Despite the slowdown, South Korea's employment rate for those aged 15 and older reached 62-point-7 percent, the highest since records began. Moon Hye-ryeon, Arirang News.
On-point: Will South Korea's exports hold up during Trump 2.0?
2025/01/14 10:00
South Korea's exports for the new year started positively, rising 3.7% on-year in the first 10 days of January, on the back of strong demand for semiconductors. Will this be sustainable even in the second Trump era? Let's turn to Professor Shim Myung-kyu. Thanks for joining us. 1. Trump's tariffs, largely rooted in his protectionist trade policies, are expected to be on the way. For South Korea, which sector will be the hardest hit by Trump's return? 2. What about chip exports? Are they also going to be in trouble? Or is this an overreaction? 3. Diversifying export markets is being touted as a solution to handle Trump's aggressive tariffs. Would you also say that's the ultimate solution? Is there any other way out? 4. But can we say Trump's return will, on the other hand, offer opportunities for Korean defense firms to expand their exports? How? What other areas of export could benefit other than arms exports? 5. Will Trump view his country's growing trade deficit with South Korea as concerning and possibly negotiate a South Korea-U.S. FTA, like he did during his first term? How likely is it that there will be a repeat of that? Why? Thanks so much for sharing your insight with us this morning. We appreciate it.