Finance minister says gov't to actively respond to excessive volatility in FX market

Finance Minister Choi Sang-mok said Thursday the government will take active steps, if necessary, to address excessive volatility in the foreign exchange (FX) market.

Since Donald Trump's victory in the US presidential election last week, the local currency has been fluctuating around the psychologically significant level of 1,400 won against the US dollar.

In a meeting with other economic policymakers in Seoul, Choi said that if there is excessive volatility in the financial and FX markets, the government will promptly and effectively implement market stabilization measures.

The minister had previously issued a similar message in mid-April, when the exchange rate surged to around 1,400 won against the greenback due to escalating tensions in the Middle East.

The finance minister also emphasized the importance of maintaining strong cooperation and a response system as part of the government's contingency plans.

Attendees at the meeting expressed a shared view that uncertainties surrounding policy changes during the transition period before the new US administration takes office are also contributing to market instability, the ministry said.

Trump has vowed to impose high tariffs on imported goods, implement protectionist measures and introduce tax cuts, which experts believe could lead to an increase in the US budget deficit, higher inflationary pressure and a slowdown in the Federal Reserve's rate-cutting actions. (Yonhap)