The government will strengthen its monitoring of financial markets as volatility increases due to a recent resurgence of COVID-19 cases here, First Vice Finance Minister Lee Eog-weon said Tuesday.

“As uncertainty related to virus variants persist, the possibility of increased volatility in the financial market in the future cannot be ruled out,” he said during a meeting on macroeconomic policies and financial affairs.

With the quick spread of the more contagious delta variant locally, the number of new COVID-19 cases exceeded 1,000 cases for the seventh consecutive day Tuesday.

But the impact of the resurgence on the market will be limited, he said, citing a rapid recovery of the real economy and foreign debt soundness.

“Even during the second and third wave of the COVID-19 pandemic, which started in August and November last year, the domestic financial market saw only a limited impact and showed its strong resilience by rapidly recovering within a few days,” Lee said.

The benchmark Kospi and secondary Kosdaq markets started to rebound Monday after dropping in the last two sessions of the previous week, reflecting jitters stemming from the government’s decision to raise social distancing measures in Greater Seoul to the highest level of the four-tier system from Monday.

The vice minister vowed to make the most of a supplementary budget worth 33 trillion won ($28.7 billion), which is currently under review at the National Assembly, to cushion the economic fallout from the pandemic.

Concerns have been raised that a global economic recovery is slowing as major countries beef up quarantine measures due to the spread of new variants of the contagious virus.

“Volatility in the global financial market has fluctuated with concerns about the slowing economic recovery due to new coronavirus variants and expectations for corporate earnings improvement,” he said.

Financial authorities will maintain a high level of vigilance and closely monitor external factors that can affect markets, including the US Federal Reserve‘s potential tapering of its stimulus program and reflation trade, which benefit from higher inflation.