“North Korea’s attack should have little impact on the country’s financial sector, although downside risks associated with the United States raising its key interest rates and uncertainties coming out of China need to be checked. The government is ready to respond proactively to all uncertainties.”
“There was a strengthening of the U.S. dollar compared with the Korean won in the offshore non-deliverable forwards market, this soon stabilized. There was a slight rise in the credit default swap premium, but this has more to do with developments taking place in emerging markets rather than North Korea.”
- Joo Hyung-hwan, vice finance minister
SEOUL, Aug. 21 (Korea Bizwire) — The spike in inter-Korean tension over the exchange of artillery fire is likely to have a limited effect on South Korea’s financial market, a vice finance minister said Friday.
North Korea fired artillery rounds at the South on Thursday, demanding a halt to loudspeaker propaganda broadcasts. South Korea responded by firing dozens of shells and warned it will deal firmly with any future provocations. Both countries have placed their militaries on high alert.
Speaking to officials at a macroeconomic policy meeting in Seoul, Joo Hyung-hwan pointed out that all past North Korean provocations had short-lived impacts on the market, stressing there is no need to be overly worried about the latest standoff.
The official said while there was a strengthening of the U.S. dollar compared with the Korean won in the offshore non-deliverable forwards market, this soon stabilized.
Related government ministries have set up an around-the-clock monitoring system to check developments in the financial and futures markets and deal with any jitters.