ID :
22089
Wed, 10/01/2008 - 16:23
Auther :
Shortlink :
http://m.oananews.org//node/22089
The shortlink copeid
S. Korea to take 'necessary' measures to tackle dollar shortage problem
SEOUL, Sept. 30 (Yonhap) -- South Korea's response to the U.S. failure to endorse an emergency rescue plan for financial markets is far too "sensitive," and the government here will take "necessary" measures to ease concerns over liquidity in the foreign currency market, Finance Minister Kang Man-soo said Tuesday.
Kang made the comments at a hastily-arranged press conference as the local stock
and currency markets tumbled, spooked by the overnight failure of the U.S.
Congress to pass the long-awaited US$700 billion bail-out package that many
observers hoped would save its staggering financial markets.
The won closed at 1,207 won, down 18.2 won from the previous day's close and
hitting the lowest level in 64 months. South Korea's benchmark Korea Composite
Stock Price Index (KOSPI) opened around 5 percent lower but clawed back most of
its earlier losses on bargain hunting, closing down 0.57 percent at 1,448.06.
"We have ample amount of foreign reserves and are ready to unload them if needed.
There is no reason to be worried about a possible liquidity problem (in the
foreign currency market)," Kang told reporters.
South Korea's currency market has been suffering from a dollar shortage, as banks
and companies are rushing to the safer greenback on concerns over a financial
crisis sparked by the collapse of investment giant Lehman Brothers Holdings Inc.
weeks ago.
The Finance Ministry recently announced that it will inject a total of $10
billion into the nation's currency swap market to provide liquidity amid
tightening credit conditions.
Kang said that if the need arises, the ministry is set to use its dollar holdings
in the foreign-exchange market as well to stem the further sliding of the local
currency, which lost more than 23 percent against the U.S. dollar since the start
of this year.
The nation's foreign reserves reached $243.2 billion as of the end of August,
down $4.32 billion from a month earlier.
Kang forecast that market conditions will improve as the nation will see its
current account shortfalls decline thanks to recent falls in oil prices. He
predicted shortfalls for September to be less than $1 billion and expected a
return to the black by October.
Earlier in the day, the Bank of Korea, the central bank, said that the nation's
current account shortfall in August reached $4.71 billion, brining its cumulative
deficit for this year to $12.6 billion.
kokobj@yna.co.kr
(END)
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Kang made the comments at a hastily-arranged press conference as the local stock
and currency markets tumbled, spooked by the overnight failure of the U.S.
Congress to pass the long-awaited US$700 billion bail-out package that many
observers hoped would save its staggering financial markets.
The won closed at 1,207 won, down 18.2 won from the previous day's close and
hitting the lowest level in 64 months. South Korea's benchmark Korea Composite
Stock Price Index (KOSPI) opened around 5 percent lower but clawed back most of
its earlier losses on bargain hunting, closing down 0.57 percent at 1,448.06.
"We have ample amount of foreign reserves and are ready to unload them if needed.
There is no reason to be worried about a possible liquidity problem (in the
foreign currency market)," Kang told reporters.
South Korea's currency market has been suffering from a dollar shortage, as banks
and companies are rushing to the safer greenback on concerns over a financial
crisis sparked by the collapse of investment giant Lehman Brothers Holdings Inc.
weeks ago.
The Finance Ministry recently announced that it will inject a total of $10
billion into the nation's currency swap market to provide liquidity amid
tightening credit conditions.
Kang said that if the need arises, the ministry is set to use its dollar holdings
in the foreign-exchange market as well to stem the further sliding of the local
currency, which lost more than 23 percent against the U.S. dollar since the start
of this year.
The nation's foreign reserves reached $243.2 billion as of the end of August,
down $4.32 billion from a month earlier.
Kang forecast that market conditions will improve as the nation will see its
current account shortfalls decline thanks to recent falls in oil prices. He
predicted shortfalls for September to be less than $1 billion and expected a
return to the black by October.
Earlier in the day, the Bank of Korea, the central bank, said that the nation's
current account shortfall in August reached $4.71 billion, brining its cumulative
deficit for this year to $12.6 billion.
kokobj@yna.co.kr
(END)
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