Investors are parking more money in funds that invest in low-grade bonds and that also offer tax favors amid low market interest rates, data showed Thursday.Cash flows into such funds amounted to 2.35 trillion won (US$2.14 billion) as of end of October in just seven months after their market debut in early April, according to the data compiled by the Korea Financial Investment Association (KOFIA). In March, the country's financial regulator allowed local financial firms to sell a new type of hig

Nov. 13, 2014

The Korean won fell sharply against the U.S. dollar Wednesday, hitting a fresh over one-year low and moving in sync with the Japanese yen’s sharp slide against the greenback.The won closed at 1,096.00 to the greenback, down 4.4 won from the previous session’s close, marking the lowest level since Sept. 5, 2013, when the comparable figure was 1,098.40 won. The local currency hit an intra-day low of 1,102.90 won at one point.The Japanese yen hit a new seven-year low against the greenback in London

Nov. 12, 2014

The economic slowdown in 2013 led South Korean companies to decrease their social contribution outlays, a report by the lobbying group of large businesses said Wednesday.According to the Federation of Korean Industries (FKI), local businesses spent little over 2.81 trillion won on various commitments, down a sharp 13.6 percent from 3.25 trillion won the year before.The findings were based on a survey carried out on 234 leading companies that engaged in corporate social responsibility (CRS) progr

Nov. 12, 2014

Foreign investment banks forecast inflation in South Korea to stay low next year amid tepid domestic demand and falling global oil prices, a report showed Tuesday.Nomura projected that inflation would reach 1.3 percent this year and 2 percent next year, both below the inflation target band by the Bank of Korea of 2.5-3.5 percent. The investment bank, however, forecast inflation would reach 3 percent in 2016. “We now expect CPI inflation to remain low for a long time due to lower commodity prices

Nov. 11, 2014

Foreign investment banks forecast inflation in South Korea to stay low next year amid tepid domestic demand and falling global oil prices, a report showed Tuesday.Nomura projected inflation to reach 1.3 percent this year and 2 percent next year, both below the inflation target band by the Bank of Korea (BOK) of 2.5-3.5 percent. The investment bank, however, forecast inflation to reach 3 percent in 2016."We now expect CPI inflation to remain low for a long time due to lower commodity prices, an e

Nov. 11, 2014

South Korean conglomerates are becoming more dependent on the Chinese market for sales growth and the reliance is likely to deepen from a recent trade pact, a report by a local corporate research firm showed Tuesday.According to CEO Score, an online corporate productivity evaluation firm, an analysis of 38 out of 200 top companies that reported their overseas earnings showed sales to China last year reached 145.15 trillion won, up 34.6 percent from around 108 trillion won in 2011.The growth rate

Nov. 11, 2014

South Korea’s won rose the most in a month as below-forecast U.S. jobs data weighed on the dollar. The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major currencies, posted its biggest loss in three weeks on Nov. 7 after the U.S. labor department said employers added 214,000 workers in October. That was less than the 235,000 estimated in a Bloomberg survey. Bank of Korea Governor Lee Ju-yeol said last week that while authorities face constraints in dealing with a weakening

Nov. 10, 2014

The bad loan ratio of South Korean banks dropped in the third quarter of this year from three months earlier on reduced fresh bad debts, the financial watchdog said Monday.The combined bad loan ratio stood at 1.72 percent at the end of September, down 0.01 percentage point from the previous quarter, according to the Financial Supervisory Service. The bad loan ratio refers to the proportion of a bank’s non-performing loans to their total lending. A debt that has been in arrears for more than 90 d

Nov. 10, 2014

South Korea’s economic territory will expand to take up about 72 percent of the world’s gross domestic product once the free trade agreement with its biggest trade partner China takes effect, industry sources said on Monday after both sides struck a deal. The trade deal covers nearly all economic areas, including products, services, investment, finance and communications. The two countries agreed to exclude rice, a key staple food for both. Experts believe the most significant part of the deal w

Nov. 10, 2014

A group representing the South Korean business community said Monday it "welcomes" the country's bilateral free trade agreement (FTA) with top trade partner China, but industry watchers forecast the tentatively reached deal may still face opposition from sectors deemed to suffer losses from the latest partnership. "The FTA with China, the No. 1 country in terms of trade volume and the second-largest economy in the world, is expected to provide a new driving force of growth for our industries and

Nov. 10, 2014

Investors brought money into South Korean stock funds last month despite the equity market slump, data showed Monday, posting the longest daily buying streak since 2007.Local stock funds, excluding index funds, saw a net inflow of 2.01 trillion won (US$1.84 billion) for 31 consecutive days from Sept. 23, according to the Korea Financial Investment Association (KFIA).The longest unbroken run of net buying lasted for 66 days between May and August in 2007 when stock funds in Asia's fourth-largest

Nov. 10, 2014

South Korean stocks are likely to face growing volatility this week as fears over a weakening yen grip investors amid a lack of upward momentum, analysts said Saturday.The benchmark Korea Composite Stock Price Index closed at 1,939.87 on last Friday, down 24.56 points from 1,964.43 the previous week.Seoul shares started the week on a weak note after the Bank of Japan’s surprise move for additional monetary easing spurred concerns about the weakening yen and pummeled shares of exporters that comp

Nov. 9, 2014

The South Korean government is expecting an 11 percent on-year increase in dividends next year from state-controlled companies that have improved their earnings, a parliamentary report showed Sunday.A budget plan submitted to the National Assembly showed the government has included 361.6 billion won ($330.6 million) as income from dividends from state-controlled companies next year, an 11.2 percent rise from this year’s 325.6 billion won. South Korea’s fiscal year ends on Dec. 31, and companies

Nov. 9, 2014

The amount of debt owed by the self-employed in South Korea has snowballed in the past four years, far surpassing the growth pace of corporate and mortgage loans amid an economic slowdown, industry data showed Sunday.  The combined loans to the self-employed by Korea's five largest commercial banks amounted to 134 trillion won (US$122.5 billion) as of end-October, adding 40 trillion won from the end of 2010, according to the data.Loan totals were provided by Kookmin Bank, Shinhan Bank, Woori Ban

Nov. 9, 2014

South Korean stocks are likely to face growing volatility next week as fears over a weakening yen grip investors amid a lack of upward momentum, analysts said Saturday.The benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,939.87 on Friday, down 24.56 points from 1,964.43 the previous week.Seoul shares started the week on a weak note after the Bank of Japan's surprise move for additional monetary easing spurred concerns about the weakening yen and pummeled shares of exporters that c

Nov. 8, 2014

The South Korean currency will continue to slide next year and fall to 1,140 won against the U.S. dollar amid the Japanese yen weakening from its stimulus package, a report said Friday.  "We are rolling forward our U.S. dollar-Korean won forecasts to 1,100 won, 1,130 won, 1,140 won for 3-, 6- and 12-month horizons, from 1,060 won, 1,080 won and 1,100 won previously," said the Goldman Sachs report. "We retain our long-term forecasts forend-2016 and end-2017 at 1,200 won."  It said that the deprec

Nov. 7, 2014

A World Bank report released last week ranked South Korea as having the fifth-best business environment among 189 countries this year. Commendably, the country also topped the Group of 20 emerging and advanced countries and came in third among Organization for Economic Cooperation and Development member countries.Between June 2013 and June 2014, “Doing Business 2015: Going Beyond Efficiency,” which measures 189 economies worldwide, documented 230 business reforms, with 145 aimed at reducing the

Nov. 6, 2014

The Korean won slumped to a fresh nine-month low against the U.S. dollar Thursday on sound economic data from the U.S. and speculation that currency authorities here may intervene to control the pace of the local currency's sharp ascent against the Japanese yen.  The won finished at 1,083.80 to the greenback, down 0.2 won from the previous session's close, marking the lowest since Feb. 3 when the comparable figure was 1,084.50. The local currency hit an intra-day low of 1,096.80 won at one point

Nov. 6, 2014

South Korea's overseas direct investment dropped significantly from a year earlier in the first nine months of the year, a government report showed Thursday, following a recent report that top South Korean firms are now sitting on more cash than ever.   In the January-September period, the country's overseas direct investment amounted to US$22.9 billion, down 13 percent from the same period last year, according to the report from the Ministry of Strategy and Finance.  The drop was attributed to

Nov. 6, 2014