Choo Kyung-ho: "High-Intensity Tightening Expands Real Economy Uncertainty... Closely Monitoring Trends"

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho is delivering opening remarks at the 'Macroeconomic and Financial Experts Meeting' held on the 24th at the Government Seoul Office in Jongno-gu, Seoul.

On the 24th, Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho stated that there is a possibility of increased uncertainty in the real economy due to the impact of high-intensity tightening, and pledged to make every effort to overcome the difficulties.

Deputy Prime Minister Choo made these remarks during a meeting with macro-finance experts at the Government Complex Seoul on the same day. He diagnosed, "While the global economic slowdown trend continues, difficulties in Korea's real economy are also ongoing. Recently, due to the aftermath of high-intensity tightening, incidents such as the Silicon Valley Bank (SVB) and Credit Suisse (CS) cases have emerged, increasing volatility in the financial markets."

He further explained, "As financial market instability may recur and uncertainty in the real economy may expand during the process of adapting to the new environment of high-intensity tightening, we will closely monitor the trends and strive to overcome the immediate difficulties."

The experts attending the meeting noted that the direct impact of the SVB incident and others on the domestic financial market is limited, but emphasized the need to carefully watch for potential risks intertwined with vulnerable sectors such as real estate project financing (PF) and household debt.

Additionally, they suggested that since mid- to long-term fiscal expenditure demands are expected to increase due to aging and other factors, it is necessary to maintain a sound fiscal stance rather than hastily changing the direction of fiscal and monetary policies.

Attendees of this meeting included Kim Hyun-wook, Professor at the Graduate School of International Policy at the Korea Development Institute (KDI); Juliana Lee, Chief Economist at Deutsche Bank; Seo Eun-jong, Head of BNP Paribas General Headquarters; Seo Cheol-soo, Head of Research Center at Mirae Asset Securities; Shin Yong-sang, Head of Financial Risk Research Center at the Korea Institute of Finance; and Ahn Dong-hyun, Professor of Economics at Seoul National University.