[Economic Outlook] Focus on Household Loan Growth... Also Attention to International Balance of Payments and Fiscal Trends

This Week's Major Economic Schedule

Hana Bank announced that it will limit the personal credit loan limit to "within the range of individual annual income." The photo shows the Hana Bank headquarters branch in Jung-gu, Seoul, on the 27th of last month. Photo by Jinhyung Kang aymsdream@

[Sejong=Asia Economy Reporter Moon Chaeseok] This week, the latest statistics on household loans, international balance of payments, and fiscal matters will be released.

The Bank of Korea will announce the "Financial Market Trends for August," including the outstanding balance and growth rate of household loans, on the 8th. In July, household loans increased by 9.7 trillion won compared to the end of June. This was due to continued demand for funds related to housing sales, jeonse (long-term lease) deposits, and public offering stock investments. The increase in household loans (9.7 trillion won) was larger than in June (6.3 trillion won), marking the highest monthly increase since statistics began in 2004. As financial authorities have demanded restraint on household loans, leading banks and financial institutions to collectively tighten lending, attention is focused on whether the pace of household loan growth changed last month.

The Bank of Korea will also release the "Preliminary Balance of Payments for July" on the 7th. The current account surplus in June was 8.85 billion dollars (approximately 10.12 trillion won), maintaining a surplus trend for 14 consecutive months since May last year. Given the continued strong exports in July, a surplus is expected for the 15th consecutive month.

Additionally, on the 9th, the Bank of Korea will submit the "Monetary and Credit Policy Report" to the National Assembly, which comprehensively covers recent monetary and financial conditions and analysis.

The Korea Development Institute (KDI) will release the September Economic Trends report on the 7th. This report provides insight into how the government-funded research institute assesses the current economic situation. In last month's economic trends, KDI judged that "while Korea's economy is supported by favorable external demand and a moderate recovery in domestic demand, uncertainties have increased due to rising raw material prices and the spread of variant viruses."

The Ministry of Economy and Finance will release the "Monthly Fiscal Trends" for July on the 10th, which includes government revenue and expenditure, fiscal balance, and national debt. The focus is on how much national tax revenue has increased. From January to June this year, national tax revenue was 181.7 trillion won, an increase of 48.8 trillion won compared to the previous year. The progress rate for January to June (the ratio of revenue to the annual target) was 64.3%, 17.7 percentage points higher than the same period last year. However, the resurgence of COVID-19 in the second half of the year may have reduced the growth rate of tax revenue.