Korea-Japan Currency Swap Resumes After 8 Years... $10 Billion Scale

South Korea and Japan have signed a currency swap agreement worth 10 billion dollars.

The Ministry of Economy and Finance announced on the 1st that the Bank of Korea has signed a currency swap agreement with the Bank of Japan. This is the first currency swap agreement between South Korea and Japan in eight years since 2015.

The contract amount is 10 billion dollars, and the contract period is three years. A currency swap is a foreign exchange transaction method in which different currencies are exchanged in advance at an agreed exchange rate.

This currency swap is in the form of exchanging the requesting country's currency with the US dollar. The Korea-Japan currency swap is structured so that when Korea supplies dollars to Japan, Japan deposits yen to Korea.

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho held the 8th Korea-Japan Finance Ministers' Meeting with Japanese Finance Minister Suzuki Shunichi at the Japanese Ministry of Finance in June and agreed to restore the Korea-Japan currency swap.

Both South Korea and Japan explained that this currency swap agreement is expected to promote financial cooperation between the two countries and contribute to strengthening the regional financial safety net.

On the 14th, an employee is organizing US dollars and Japanese yen at the Hana Bank Counterfeit Response Center in Jung-gu, Seoul. Photo by Jinhyung Kang aymsdream@