Lee Won Lee, Deputy Minister of Strategy and Finance. provided by the Ministry of Finance.
The government has recently diagnosed that the volatility of domestic and foreign financial markets may increase due to the outbreak of the Omicron mutant virus.
First Vice Minister of Strategy and Finance Lee Won Lee held a macroeconomic and financial inspection meeting on the 29th and checked the domestic and foreign financial market trends following the outbreak of the Omicron mutant virus.
Vice Minister Lee said, “Until a clear analysis of the spread of omicron mutations and risks is released, it is difficult to rule out the possibility that the volatility of domestic and foreign financial markets will increase in the short term due to the lack of information.”
Due to the recent outbreak of the Omicron mutant virus, domestic and foreign stock prices have fallen and the exchange rate has risen, showing increased volatility in domestic and foreign financial markets. Interest rates and international oil prices, which had been on an upward trend in the past, also fell sharply. The government evaluated that “the Korean financial market is also being affected to some extent as risk aversion in the international financial market is strengthened and investor sentiment has contracted.”
However, the government was wary of an expanded interpretation of the negative ripple effect on the economy. Vice Minister Lee said, “In the case of the third spread of COVID-19, the stock price fell and the exchange rate rose one to two weeks later, after which it recovered to the pre-shock level. He added that the global quarantine and medical response system has been continuously expanded and strengthened, and the adaptability to cushion the impact of COVID-19 has increased due to non-face-to-face work and the spread of online consumption.
“We will operate a 24-hour monitoring system for mutated viruses and domestic and foreign financial markets to more thoroughly check market stabilization measures for each financial market and situation,” said Vice Minister Lee.