SEOUL, Jan 5 (Reuters) – South Korea’s top economic policymakers on Monday vowed efforts to stabilise the currency market as the won’s recent declines defied economic fundamentals.
“We will closely monitor financial and foreign exchange markets and make efforts to resolve the structural demand-supply imbalance in the foreign exchange market,” Finance Minister Koo Yun-cheol said in remarks prepared for a New Year’s event.
The won was down 0.3% at 1,448.6 per dollar on Monday, extending losses for a fourth straight session, following a sharp rebound in late December from eight-month lows on policy efforts to reverse the trend.
Koo also said the government would prepare tax incentives for long-term investment in domestic stocks.
At the event hosted for the financial sector, Bank of Korea Governor Rhee Chang-yong said the central bank and the government, as well as relevant agencies, had to cooperate to address recent depreciating trends in the won that did not align with economic fundamentals.
Looking ahead, Rhee said monetary policy would be operated more delicately as there would be bigger trade-offs in considering growth, inflation and financial stability.
(Reporting by Jihoon LeeEditing by Shri Navaratnam)
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