S. Korea ready to calm financial markets: finance minister

By Kang Yoon-seung

SEJONG, Oct. 5 (Yonhap) — South Korea’s finance minister said Thursday the government is ready to take measures when necessary as financial markets may see increased volatility on a surge in U.S. bond yields.

The remark came after South Korea’s stocks fell to a six-month low the previous day as investors anticipated the U.S. Federal Reserve to keep its hawkish stance for the time being. The South Korean won also fell against the U.S. dollar to hit an 11-month low the previous day.

“Recently, the financial markets at home and abroad are experiencing increased volatility as yields on U.S. government bonds soared with the U.S. dollar also remaining strong amid concerns over the prolonged monetary tightening move,” Finance Minister Choo Kyung-ho said during a meeting with economy-related ministers.

Choo said the government will continue to closely monitor situations in the financial market and take measures when necessary.

“To prevent the foreign exchange market from experiencing instability due to speculative transactions by overseas firms, we plan to take proactive actions and activate measures to stabilize the bond market when necessary,” Choo said.

Touching on consumer prices, which rose 3.7 percent on-year in September, the finance minister said the growth was attributable to the higher global oil prices, but the inflation is expected to begin stabilizing this month.

The government will also come up with separate measures to stabilize prices of agricultural and petroleum products this month, Choo added.