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S. Korea to take appropriate market stabilizing measures

All News 09:24 June 15, 2017

SEOUL, June 15 (Yonhap) -- South Korea said Thursday that it will tighten monitoring of the local financial market and take immediate measures to stave off any fallout from the latest U.S. rate increase.

"We will get fully prepared to minimize the adverse impact of the U.S. rate hike," Vice Finance Minister Ko Hyoung-kwon said at a financial policy meeting in Seoul. "The government will keep close tabs on the market and take stabilizing measures in a timely manner."

The U.S. Federal Reserve raised key interest rates by 0.25 percentage point Wednesday (local time), making its target range for the federal funds rate from 1 to 1.25 percent, a level that's on par with South Korea's.

It was the second time the Fed has raised rates this year after the first hike in March.

The Fed also added it plans to reduce its securities holdings, a move that could spur rates to rise further.

"The Fed's decision did not cause a sudden fluctuation as the market has long anticipated it," the official said. "The South Korean market will likely experience limited volatility as it has favorable fiscal stability."

The South Korean benchmark KOSPI started 0.03 percent higher to reach 2,373.36 points at 9:00 a.m. from a day earlier, while the local currency gained ground against the U.S. dollar to change hands at 1,120, up 3.9 won from the previous session.

South Korea's Vice Finance Minister Ko Hyoung-kwon speaks at a policy meeting in Seoul on June 15, 2017. (Yonhap)


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