Brexit react: BOK says more than 3 tril. won to be injected within this week

(From Korea Economic Daily)

South Korea’s central bank has decided to inject over 3 trillion won ($26 billion) in short-term liquidity into the market this week in the wake of the UK’s decision to leave the EU, the Korea Economic Daily reported.

The decision was make at an emergency executive meeting, presided over by its Governor Lee Ju-yeol, on June 27.

This move is designed to  minimize the impact of Brexit on the Korean economy. The liquidity measure will be implemented through the issuance of monetary stabilization bonds, deposits of the monetary stabilization account, and the sales of repurchase agreements.

The surprise Brexit vote prompted central bank Governor Lee Ju-yeol  to return to Korea one day earlier than scheduled after taking part in the annual meeting of the Bank for International Settlements held in Basel in Switzerland on June 25-26.

“We will get ourselves well prepared for any possible deterioration of the situation ahead by thoroughly complementing our contingency plans. We will also review the impact of Brexit on the real economy from various angles, including exports and domestic economic growth,” reportedly said.

He added, “We will strengthen policy cooperation and information exchange not only with the central government and other regulatory authorities, but also with the central banks of major economies.”

Categories: Asia Unhedged, Koreas

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