The presidential Blue House. [Yonhap News Photo]
South Korea vowed Saturday to take preemptive measures against factors that could destabilize markets following the parliamentary impeachment against President Park Geun-hye.
The Ministry of Strategy and Finance said after an emergency meeting of relevant officials that the government also will take swift and stern steps, if necessary, to contain any volatility in the financial market. No details were given.
Acting President Hwang Kyo-ahn called on officials to closely monitor the financial markets at home and abroad and to ensure that internal and external instabilities would not affect consumer and investor sentiment
South Korea's stock and foreign-exchange markets ended without showing any volatile moves on Friday as Park was widely expected to be impeached in the vote and the expectations were already factored in the market.
The Bank of Korea said the impeachment would have a limited impact on the economy, noting South Korea's economy is mainly affected by external factors, not the impeachment decision.
South Korea's credit default swap premium -- which measures a country's credit risks -- stood at 42.5 basis points on Friday, unchanged from the previous day's level. The Korean won slightly fell to 1,168.8 against the US dollar in the non-deliverable forward markets on Friday from 1,163.3 won a session earlier.
The impeachment has sparked concerns on political uncertainties at home on top of overseas uncertainties that include the policies of U.S. President-elect Donald Trump and the pace of a possible U.S. rate hike.
Still, some investment banks believe the impeachment decision has lifted some political uncertainty and won't undermine confidence in the South Korean economy, according to the central bank. The BOK said a prolonged vacuum of power could increase downside risks in the economy, citing some foreign investment banks.
(Yonhap)
reporter
Park Sae-jin
swatchsjp@ajunews.com
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