Economic Issues in Korea

Economic Issues in Korea

  • Submitted By: SeoJeonghoon
  • Date Submitted: 11/03/2008 12:39 PM
  • Category: Business
  • Words: 2695
  • Page: 11
  • Views: 922

(6월 3일 화)Currency hedges stoke legal disputes

This article showed Several companies are moving to file legal complaints against banks on losses incurred on currency option contracts.
I confirmed that the banks did not properly inform them of the risk and that the contracts have many unfair clauses.
The contracts allow the companies to hedge their assets against foreign exchange risk if the dollar trades within a certain range.
Most of the option buyers expected the dollar-won rate to stay between 900 to 1,000 won per dollar, limiting their position under 1,000 won.
But the greenback has abruptly strengthened to around 1,050 won per dollar in recent months due to the government's purchase of dollars in order to depreciate the Korean won.
The sharp decline in the won's value has caused the companies to incur big financial losses.

(6월 4일 수)China quake recovery to cost $72 billion: Deutsche Bank

I confirm that after reading this article China's reconstruction spending after the earthquake will exceed $72 billion in the next three years.
Spending will peak from the fourth quarter of this year to the second quarter of next year.
This article showed that China's cement demand will rise by 61.1 percent in the year starting July 1 from the previous 12 months because of the reconstruction, compared with previous estimate of 12 percent.
The People's Bank of China Monday said it regards the danger from rising prices, a problem exacerbated by the quake, as the bigger threat to the world's fastest-growing major economy.
China faces inflation close to a 12-year high and weakening global demand for exports.

(6월 5일 목) OECD cuts Korea's growth forecast

This article said that The OECD slashed its growth forecast for Korea to 4.3 percent this year.
That figure is 0.9 percentage point below the 5.2 percent the OECD projected in December.
It attributed the revision to sluggish facility investment in the first quarter amid increased...

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