Finance Minister Koo Yun-cheol speaks after passing payments, together with amendments to the Nationwide Finance Act, on the Nationwide Meeting in Seoul, Thursday. Yonhap
Finance Minister Koo Yun-cheol mentioned Friday that strengthening the nation’s long-term financial competitiveness is the basic method to stabilize the unstable overseas change market because the Korean gained continues to weaken towards the U.S. greenback.
“Making the home market extra engaging and aggressive is the basic resolution,” Koo mentioned in a neighborhood radio interview.
Because the home foreign money continues to face strain, the Ministry of Economic system and Finance, the Financial institution of Korea (BOK), the Nationwide Pension Service (NPS), and the Ministry of Well being and Welfare overseeing the pension fund shaped a joint session physique final month.
The NPS, the world’s third-largest pension fund, has a rising abroad portfolio, which market contributors have cited as an element contributing to strain on the native foreign money.
Requested whether or not the federal government would possibly depend on the NPS to assist defend the gained, Koo reiterated that the federal government “won’t ever intervene within the fund’s asset administration choices.”
Following the institution of the consultative physique, analysts have speculated that discussions might embody changes to the NPS’ technique on foreign money hedging, particularly amid considerations the federal government would possibly not directly use the fund to curb the gained’s depreciation.
Koo mentioned the NPS naturally generates demand for {dollars} because it expands its abroad investments however should ultimately repatriate {dollars} to pay out pensions, a course of that might place upward strain on the gained.
