AJU PRESS ASIA FIRST NEWS AGENCY

Journalist

Kim Yeon-jae
Kim Yeon-jae김연재
ReporterBank of Korea & Market, Macroeconomics
Kim Yeon-jae is a journalist at AJU Press (AJP's English platform),
covering macroeconomics, international finance, and geopolitics.
He closely tracks central bank monetary policies, global energy supply chains,
and the Korean defense industry. "Peering into the risks behind the euphoria."
Latest by Kim Yeon-jae
  • Chipflation fears cool Koreas chip output
    Chipflation fears cool Korea's chip output SEOUL, June 30 (AJP) - South Korea's sharp pullback in chip output in May is adding to signs that the global memory crunch is no longer confined to data centers, with chipflation from soaring memory prices beginning to strain consumer spending and factory floors. Factory output fell 3.0 percent from the previous month in May, matching its steepest monthly drop in a year, according to the Ministry of Data and Statistics on Tuesday. The index of all-industry production, excluding agriculture, forestry and fisheries, slipped 0.3 percent from April, marking a second consecutive monthly decline. Semiconductor production tumbled 10.0 percent from the previous month, led by lower output of DRAM and NAND flash memory chips. The decline reflects an industry-wide shift in wafer lines rather than reduced demand. As memory manufacturers increasingly allocate capacity to higher-margin high-bandwidth memory (HBM) for hyperscale AI data centers and AI accelerators, supplies of conventional DRAM and NAND used in smartphones, personal computers and other consumer electronics have tightened sharply, pushing up component costs throughout the supply chain. Lee Doo-won, a senior ministry official, told reporters the decline reflected production adjustments related to delivery schedules and higher semiconductor prices, while stressing that underlying demand for chips remained strong. Other output data showed improvements. Retail sales edged up 0.1 percent in May after plunging 3.5 percent in April, while equipment investment slipped 0.1 percent. Services output rose 1.3 percent and construction completed rebounded 3.8 percent, helping cushion the overall decline in industrial activity. The tightening supply comes as South Korea's memory industry enjoys one of its strongest profit cycles on record. Samsung Electronics and SK hynix this week announced multi-trillion-won capital spending plans to expand advanced memory production. SK Group Chairman Chey Tae-won said global memory shortages are likely to persist as each new generation of artificial intelligence requires exponentially greater memory capacity, describing memory as the indispensable fuel powering the AI era. Micron Technology also signaled a structural shift in the industry during last week's record quarterly earnings release. The U.S. chipmaker said it has signed 16 Strategic Customer Agreements with major hyperscale customers representing roughly $22 billion in long-term commitments, arguing that such contracts would make its earnings more durable and predictable. The announcement underscored how AI infrastructure customers have become the industry's priority allocation. The shift is increasingly being felt by consumer electronics manufacturers. Research firm Gartner estimates combined DRAM and NAND prices could climb as much as 130 percent by the end of 2026, lifting PC prices by 17 percent and smartphone prices by 13 percent from 2025 levels. IDC has likewise warned that rising memory costs are forcing device makers to adjust pricing, product specifications and production plans. The impact has already begun to appear on store shelves. Apple last week raised prices for several MacBook and iPad models, citing sharply higher memory and storage costs driven by AI-related demand, while Xiaomi increased prices on several smartphone models in China earlier this year. Samsung Electronics has also raised prices for selected higher-capacity Galaxy smartphone models as memory costs and foreign exchange pressures mounted. Higher-storage devices are particularly vulnerable because memory accounts for a larger share of their bill of materials, making premium smartphones and PCs among the first products to reflect the industry's pricing power. Consumers have taken collective action amid the surge in prices. A proposed class-action lawsuit filed on June 25 in the U.S. District Court for the Northern District of California accuses Samsung Electronics, SK hynix and Micron Technology of conspiring to restrict supplies of conventional DDR3 and DDR4 memory while shifting production toward higher-margin HBM, allegedly inflating prices for mainstream memory products. While the plaintiffs allege unlawful coordination, most industry analysts attribute the shortage to explosive AI infrastructure demand, production conversion cycles and advanced packaging bottlenecks rather than coordinated supply restraint. Central banks increasingly worry that "chipflation" could keep core inflation elevated even after Gulf-related energy price pressures subside, as semiconductors become an increasingly significant input cost across the global economy. The May production figures suggest not a collapse in semiconductor demand, but a structural reallocation of manufacturing capacity toward AI infrastructure. As more memory output is directed to data centers, the costs are increasingly flowing through the broader economy—from factory floors to consumers purchasing everyday electronic devices. 2026-06-30 11:28:29
  • Koreas May factory output falls by steepest in a year on lower chip turnout
    Korea's May factory output falls by steepest in a year on lower chip turnout SEOUL, June 30 (AJP) - South Korea’s industrial output fell for a second straight month in May as factory output dropped 3 percent on chip delivery adjustments, underscoring the weight of chipmaking on the economic performance, government data showed Tuesday. Manufacturing production fell 3.0 percent from the previous month, the steepest fall in a year, and dropped 0.9 percent from a year earlier. Output in the broader mining and manufacturing likewise fell 3.0 percent from April. The index of all industry production, excluding agriculture, forestry and fisheries, fell 0.3 percent from the previous month, extending a 0.4 percent decline in April, according to the Ministry of Data and Statistics. From a year earlier, overall production rose 2.3 percent, softening from 2.4 percent in April and 3.7 percent in March. Semiconductor production fell 10.0 percent due to lower output of flash memory and DRAM chips owing to delivery adjustments, rather than a fall in demand, the ministry said. Retail sales edged up 0.1 percent after falling 3.5 percent in April, while equipment investment slipped 0.1 percent. Services output rose 1.3 percent and construction completed rebounded 3.8 percent, helping cushion the broader decline. The cyclical component of the coincident composite index, which reflects current economic conditions, fell 0.3 point to 99.9, while the leading index rose 0.7 point to 104.8. 2026-06-30 09:17:53
  • KOSPIs volatility deepens on fragile foundation
    KOSPI's volatility deepens on fragile foundation SEOUL, June 29 (AJP) - South Korea's stock market still looks spectacular despite its recent correction. Underneath, however, the rally is becoming increasingly narrow, speculative and volatile—three characteristics that help explain why the Korean won remains stuck near crisis-era levels despite the soaring benchmark. The latest evidence came Monday as the market's advance-decline ratio (ADR), a widely watched measure of market breadth, remained in oversold territory, highlighting how gains continue to be concentrated in a handful of heavyweight semiconductor stocks rather than spread across the broader market. According to the Korea Exchange (KRX), the KOSPI's ADR stood at 68.96 percent on Monday, while the KOSDAQ's measured 64.45 percent. Both improved from Thursday's readings of 59.79 percent and 55.04 percent, respectively, but remained below the 75 percent level widely regarded by technical analysts as an oversold threshold. The ADR compares the number of advancing and declining stocks over the previous 20 trading sessions. A reading below 100 percent means more stocks have fallen than risen. When the ratio remains weak while the headline index climbs, it typically signals that only a small number of large-cap stocks are carrying the market higher. That is precisely what has happened in Seoul. Samsung Electronics and SK hynix have dominated the rally as investors poured into AI-related memory-chip plays, while much of the rest of the market has struggled to keep pace. According to Korea Exchange data, the KOSPI's market capitalization climbed 44.36 percent between March 3 and last Thursday. During the same period, the combined market value of Samsung Electronics and SK hynix surged 113.24 percent. By comparison, the KOSPI 200 Ex-Top 10 Index—which excludes the market's ten largest companies—expanded by only 1.1 percent, underscoring how little of the rally has filtered into the broader market. Retail investors have become even more concentrated. Last month, regulators approved leveraged single-stock exchange-traded funds linked to Samsung Electronics and SK hynix, allowing Korean investors to trade domestically products that had previously been available mainly in overseas markets such as Hong Kong. The funds seek to deliver roughly twice the daily movement of each underlying stock, making them products primarily suited to short-term traders willing to accept significant volatility. The immediate policy objective appears to have been achieved. Financial authorities said Korean investors became net sellers of comparable Hong Kong-listed products after domestic ETFs were introduced, suggesting that some trading activity has returned to the local market. The broader investment picture, however, tells a different story. Rather than reducing overseas investment, Korean retail investors have shifted aggressively toward leveraged U.S. semiconductor products. According to Korea Securities Depository data, Korean investors purchased a net $1.76 billion of the Direxion Daily Semiconductor Bull 3X Shares (SOXL) during the second week of June alone. SOXL attracted more than eight times the net buying of KORU, the leveraged ETF tracking the Korean market. Over the past month, SOXL ranked as the single most-purchased U.S. security by Korean investors, with cumulative purchases reaching $5.39 billion. Other AI and semiconductor-related names—including Micron Technology, Marvell Technology, Nvidia, Arm, the iShares Semiconductor ETF and the Roundhill Memory ETF—also dominated overseas buying. The trend suggests that Korean retail investors are becoming more concentrated in semiconductor exposure rather than more diversified. Foreign investors, meanwhile, have continued heading in the opposite direction. According to Korea Exchange data, overseas investors have sold more than 40 trillion won worth of KOSPI shares during June, including more than 37 trillion won through Thursday and another 4.3 trillion won on Monday. That divergence has become increasingly important for the foreign-exchange market. Domestic investors may be sustaining the stock rally, but they cannot replace foreign capital when it comes to supporting the Korean won. At the same time, Korean households continue sending money abroad to purchase overseas semiconductor and AI products, reinforcing capital outflows even as local equities remain near record highs. The result is an unusual market dynamic: rising equity prices accompanied by a persistently weak currency. Monday's trading illustrated that uneven picture. The KOSPI slipped 0.2 percent to 8,394.65 as concerns over the U.S.-Iran standoff, Apple's planned price increases and questions over whether the memory cycle is approaching a peak weighed on large-cap semiconductor shares. The KOSDAQ, by contrast, surged 8.23 percent to 920.57 amid renewed expectations that the government will introduce measures to revive smaller growth companies. Even so, the KOSDAQ's advance-decline ratio remained below the oversold threshold, indicating that the rebound has yet to broaden meaningfully. The derivatives market painted an equally cautious picture. The VKOSPI—South Korea's equivalent of the VIX volatility index—closed at 96.94, indicating traders continue to expect unusually large market swings despite the relatively modest movement in headline indices. The next test will come with July earnings. Another round of blockbuster results from Samsung Electronics and SK hynix could extend the chip-led rally while making the market even more concentrated. Any disappointment, however, could expose just how dependent both the KOSPI and retail sentiment have become on a remarkably small group of AI-related stocks. For now, the headline index continues to suggest strength. The market beneath it tells a far more fragile story. 2026-06-29 17:30:42
  • BOK hunts for successor to lead its research institute
    BOK hunts for successor to lead its research institute SEOUL, June 29 (AJP) - The Bank of Korea (BOK) is scouting for an economist who will head its affiliated research institute, the central bank said on Monday. According to its open recruitment notice, the successful candidate, who will replace incumbent Lee Jae-won, a former professor at Seoul National University who took the role in 2023, will head the Economic Research Institute and be responsible for shaping the BOK's medium- to long-term research agenda as chief economist, regardless of whether the position is filled internally or externally. Lee is scheduled to leave the post at the end of September and return to his alma mater. Once hired, he or she will be responsible for setting the institute's overall direction, conducting research on monetary and financial issues, the financial system and macroeconomic developments, and managing domestic and international research exchanges. Applicants must hold a doctorate degree and have at least 15 years of work experience at financial agencies or other institutions including the BOK, universities, or international organizations. Expertise in central bank-related fields including monetary finance and macroeconomics would be a plus, according to the BOK. Applications for the three-year contract position, which can be extended by up to two years, should be submitted by July 10, with candidates undergoing document screening, background checks, interviews and a medical checkup. The successful candidate is expected to take up the post as early as October. 2026-06-29 15:51:55
  • Another early exit leaves Korean football searching for answers again
    Another early exit leaves Korean football searching for answers again SEOUL, June 29 (AJP) - "Sorry cannot make amends for the sense of betrayal for those who held onto hope until the very last minute," said 25-year-old Seoul resident Kim Sung-min. Like millions of South Koreans, Kim spent the weekend after Thursday's devastating defeat to South Africa watching the remaining World Cup matches, clinging to the slim possibility that results elsewhere might yet rescue Korea's campaign. "Our only hope was to see Son Heung-min play in what could have been his last World Cup," Kim said. "That was taken away from us." For South Koreans, the World Cup has always been an emotional contradiction. Expectations soar every four years, fuelled by memories of the country's extraordinary run to the semifinals on home soil in 2002, even when reality suggests otherwise. This time, even hope eventually ran out. The fallout from South Korea's group-stage exit at the 2026 FIFA World Cup is now spreading far beyond the resignation of head coach Hong Myung-bo. It has reopened uncomfortable questions about the Korea Football Association's governance, its long-term planning and, once again, the search for the right man to lead one of Asia's traditional football powers. Hong, one of the heroes of the 2002 team, offered to step down in Guadalajara on Sunday shortly after Korea's elimination became mathematically certain. By the time dawn broke in Seoul on Monday, the resignation was official. South Korea had begun the tournament brightly with a 2-1 comeback victory over Czechia. But successive 1-0 defeats to hosts Mexico and South Africa left the Taeguk Warriors stranded on three points. The decisive blow came against South Africa. A draw would have been enough to send Korea into the round of 32 under FIFA's expanded 48-team format. Instead, Hong's side delivered its most timid display of the tournament when everything was on the line. The consequences extended beyond elimination. FIFA's latest rankings dropped South Korea to 32nd, its lowest position since December 2021 and its first fall outside the world's top 30 in more than four years. For Hong, it marked an unwanted piece of history. It was his second World Cup campaign ending in a group-stage exit as national team manager, following the disappointing 2014 tournament in Brazil. Few Korean coaches have been given two opportunities to lead the national team at football's biggest stage. Hong failed to justify either. The contrast with neighboring Japan has only sharpened the disappointment. While Hajime Moriyasu has remained in charge since 2018, providing continuity through successive tournaments and a clear footballing identity, South Korea has lurched from one managerial reset to another, rarely allowing a coach enough time to build a lasting system. Hong returned to the national team in July 2024 following Jurgen Klinsmann's dismissal. His appointment was controversial from the outset, arguably attracting even greater scrutiny than Klinsmann's own hiring. At the time, the KFA defended its decision by pointing to Hong's tactical philosophy, his K League titles with Ulsan HD, his familiarity with both youth and senior national teams and his understanding of Korean football's structure. Lee Lim-saeng, then technical director, argued that Hong's work at Ulsan demonstrated the possession structure, pressing discipline and squad management required at international level. He also said Hong could provide continuity throughout the national team programme. Instead, the World Cup exposed precisely the qualities Korea was supposed to possess. The team never established tactical control. Its pressing lacked conviction, possession seldom translated into genuine scoring opportunities and, when matches drifted away, there appeared to be neither an alternative plan nor the confidence to execute one. Against South Africa, Korea struggled to alter its tempo, reshape its attack or impose itself on a match that effectively became a knockout game. That failure has inevitably revived comparisons with Jesse Marsch, one of the foreign candidates Korea considered before choosing Hong. Marsch eventually took charge of Canada, guiding an injury-hit squad into the knockout rounds after defeating South Africa 1-0 with a stoppage-time winner. Korea, despite fielding one of the strongest generations of overseas-based players in its history, could not overcome the same opponent. The comparison is an uncomfortable reminder of the decision the KFA ultimately made. The appointment process itself remains under scrutiny. In its 2024 audit, the Ministry of Culture, Sports and Tourism concluded that the KFA had violated its own procedures when selecting Hong. The ministry found that Lee Lim-saeng, who was not a member of the National Teams Committee, lacked the authority to recommend the final candidate and that the evaluation process had not operated as intended. Following the resignation of committee chairman Chung Hae-sung during the search, Lee conducted meetings with foreign candidates before personally visiting Hong to offer him the job. According to the ministry, Hong's meeting differed from those held with other candidates and did not follow the same interview process or procedural safeguards. The controversy did not end there. Police opened an investigation following complaints over the appointment process, while a Seoul court later acknowledged procedural problems surrounding both the Hong and Klinsmann appointments. Those governance questions have returned with greater force now that the sporting results have collapsed alongside them. Criticism has also broadened to the KFA's wider administration, with some questioning decisions ranging from national team logistics to the construction of the new National Football Centre in Cheonan, roughly two hours from Incheon International Airport depending on traffic. Attention has once again turned to KFA President Chung Mong-gyu, who has led Korean football since 2013 and indicated before the tournament that he intended to step down afterward. Many within Korean football now argue that replacing another coach will not be enough. What the federation requires is structural reform after more than a decade of recurring managerial upheaval, inconsistent planning and mounting public distrust. President Lee Jae Myung added political weight to the debate following Korea's elimination, saying the tournament demonstrated what happens when "an incompetent person is placed in charge." He instructed the Ministry of Culture, Sports and Tourism to examine the causes of the failure and recommend measures to prevent a repeat. The national team now faces another familiar crossroads. With less than a year remaining before the AFC Asian Cup in Saudi Arabia, Korea once again finds itself searching for a new head coach while debating the direction of its football administration. It is a cycle that has repeated itself after the departures of Shin Tae-yong following the 2018 World Cup, Paulo Bento after Qatar in 2022 and now Hong after North America. For supporters, however, the deepest frustration lies elsewhere. It is not simply that Korea failed to advance. It is that, despite possessing arguably the finest generation of footballers in its history — led by Son Heung-min, Kim Min-jae, Lee Kang-in, Hwang Hee-chan and Hwang In-beom — the national team once again looked less than the sum of its parts. Another World Cup has ended. Another coach has fallen. And Korean football is left asking the same questions it has been asking for more than a decade. 2026-06-29 14:03:54
  • South Koreas round of 32 hopes dashed at World Cup
    South Korea's round of 32 hopes dashed at World Cup SEOUL, June 28 (AJP) - South Korea's hopes of reaching the round of 32 at this year's World Cup were shattered after DR Congo secured a 3–1 win over Uzbekistan, eliminating the country's last remaining slim chance of advancing to the next round. South Korea, which finished third in its group after losing to South Africa in its final group-stage match in Monterrey in northeastern Mexico last week, had been relying on luck, waiting for results of matches from other groups to advance, determined by points earned and goal difference. Even a draw against South Africa would have allowed South Korea to advance, but the defeat left it with only a narrow chance of continuing its World Cup run as one of the eight best third-placed finishers. With several possible scenarios still offering South Korea a chance, many fans had been waiting for results, only to see their hopes fade over the past few days. Ecuador's 2–1 win over Germany and Paraguay's 0–0 draw with Australia lifted both sides above South Korea, followed by Senegal's 5–0 rout of Iraq, which saw the African side move above South Korea on goal difference despite both teams finishing on three points. Iran added another blow by drawing 1-1 with Egypt, ending the group stage on three points and a goal difference of zero, enough to rank ahead of South Korea. South Korea was still clinging to its final chances after those results, but Croatia's 2–1 win over Ghana pushed it deeper into danger. Croatia's victory lifted it into second place, while Ghana slipped to third on four points, still comfortably ahead of South Korea in the third-placed team rankings. The final blow came from Group K. Uzbekistan took the lead against DR Congo, briefly keeping South Korea's hopes alive. But DR Congo responded with three unanswered goals and moved to the brink of a 3-1 win that would take them to four points. If the scoreline holds, DR Congo will become the eighth third-placed team to finish ahead of South Korea, pushing the country out of the knockout stage regardless of the remaining Group J results. South Korea would fall behind Sweden, Ecuador, Ghana, Bosnia and Herzegovina, Paraguay, DR Congo, Senegal and Iran among the third-placed teams. For head coach Hong Myung-bo, the exit marks another painful World Cup failure. He previously led Korea at the 2014 World Cup in Brazil, where the country also failed to survive the group stage. This time, the disappointment may cut deeper, given that it was grouped with the Czech Republic, also known as Czechia, Mexico, and South Africa, widely seen as manageable. South Korea opened the tournament with a 2-1 win over Czechia, raising hopes of a smoother journey to the knockout stage. But a 1–0 defeat to Mexico meant it needed a result against South Africa, and it failed to deliver when a berth was still in its own hands. But South Korea struggled to create clear chances against the African side, lacked urgency in possession, and failed to turn long spells of pressure into meaningful attacks. Hong's tactics also drew sharp criticism. Needing only a draw, South Korea showed little flexibility in formation or tempo and failed to adapt after South Africa cut off passing through the middle, leaving them stuck in a plan they were reluctant to change. With a good start after winning its opener, South Korea went on to lose its two key matches and eventually saw its final hopes fade away. 2026-06-28 11:28:41
  • Seoul to freeze utility charges and lower pump price cap
    Seoul to freeze utility charges and lower pump price cap SEOUL, June 26 (AJP) -South Korea will freeze public utility rates in the second half and lower the ceiling on gasoline prices to help restore energy costs to pre-war levels and contain inflation under 3 percent, while rolling out 1 trillion won ($647 million) worth of fresh food discounts and aid for the self-employed to ese their burden from high prices, the government said Friday. The measures mark the first phase of the government's gradual rollback of emergency economic responses introduced during the Middle East conflict, as easing oil prices allow policymakers to shift their focus from crisis management to stabilizing household finances. Deputy Prime Minister and Finance Minister Koo Yun-cheol announced the package while chairing an emergency economic headquarters meeting, a ministerial economic policy meeting and a special task force on consumer prices at the Government Complex Seoul. "The external uncertainty has gradually eased since the memorandum of understanding ending the Middle East conflict," Koo said, noting that international crude prices have fallen and the average retail diesel price in South Korea has dropped below 2,000 won per liter for the first time in two months. He cautioned, however, that uncertainty surrounding follow-up negotiations remains, while households continue to grapple with high inflation, elevated exchange rates, high interest rates and slowing employment. "The government will devote all available efforts to stabilizing and restoring the people's livelihoods while preparing in earnest for post-war economic normalization and a new leap forward," Koo said. "We will closely monitor developments in the Middle East and the domestic economy while gradually adjusting the emergency response measures currently in place." Korea's producer prices spiked 8.5 percent from a year-ago period in May, the fastest annual increase since the pandemic peak in 2022, while annual inflation rose 3.1 percent on year in May. The Bank of Korea has forecast inflation would stay around 3 percent for "a considerable period." The government said the seventh oil price ceiling, scheduled to be announced later Friday, will be set lower than the current level to reflect the decline in international crude prices. The ceiling will remain in place until retail fuel prices stabilize. To ease food inflation, the government will launch its largest-ever discount campaign on agricultural, livestock and fisheries products during July and August. Fresh egg imports will be expanded more than sixfold, with an additional 200 million eggs to be imported to stabilize prices. The government will also dispatch a special delegation to Norway next month to directly import 2,000 tons of Norwegian mackerel for low-price sales, while purchasing domestically produced fish originally intended for export and supplying them to consumers at half price. To ease energy costs, electricity and natural gas tariffs will remain frozen through the second half of the year, while the levy on LPG butane sales will be temporarily waived through year-end. Households receiving energy vouchers for kerosene or LPG heating will receive an additional 147,000 won, which can be used between October 2026 and May 2027, on top of their existing benefits. The package also expands support for vulnerable groups and small businesses. Toll discounts on expressways will be extended to more people with disabilities and national merit recipients, while the government's lending program for small businesses hit by high fuel prices will double to 3 trillion won from 1.5 trillion won. Additional cashback incentives will also be offered to certified low-price retailers. Separately, the government adopted a Basic Plan for Employment Stability in Industrial Transition to prepare for labor market disruptions stemming from artificial intelligence and the green transition. The plan calls for an early warning system to monitor employment changes by industry and region, while areas facing severe disruption, including coal-fired power plant closures, will be designated as "Just Transition Special Zones" eligible for enhanced government support. The government will also expand vocational training in AI and green technologies for both incumbent workers and job seekers. As part of the initiative, it plans to train 1,000 AI specialists in the second half of this year through intensive advanced technology programs linked to employment and startup opportunities. Koo said the government would soon unveil additional measures to support small and medium-sized enterprises affected by the strong won-dollar exchange rate, while continuing structural reforms to help the economy adapt to the accelerating AI and green transformation. 2026-06-26 09:14:55
  • US assets make up nearly half of Koreas external financial holdings
    US assets make up nearly half of Korea's external financial holdings SEOUL, June 25 (AJP) - South Korea's financial exposure to the United States topped $1 trillion for the first time last year as Wall Street's rally deepened the country's tilt toward Uncle Sam assets. The Bank of Korea said Thursday that Korea’s external financial assets, excluding reserve assets, rose by $344.8 billion from a year earlier to $2.44 trillion at the end of 2025. The United States accounted for $1.15 trillion, or 47.1 percent of the total, the largest share by region. The European Union followed with $307.5 billion, while Southeast Asia stood at $279.5 billion. Korea’s holdings of U.S. assets increased by $204.2 billion from the previous year, driven by residents’ overseas securities investment and gains in global stock markets. Moon Sang-yoon, head of the BOK’s international investment statistics team, said Korea’s U.S. financial assets have grown steadily since the mid-2010s, especially since 2018 and 2019, led by stock investment. “The relatively faster rise in U.S. stock prices compared with other countries also had a significant impact,” Moon said. U.S. assets dominated Korea’s overseas portfolio investment. Korean residents held $802.8 billion in U.S. portfolio assets at the end of 2025, accounting for 64.1 percent of total overseas portfolio investment. Direct investment was also largest in the United States at $250.1 billion, followed by Southeast Asia at $174.7 billion. The currency breakdown showed an even stronger dollar bias. Dollar-denominated external financial assets stood at $1.5136 trillion, or 62.0 percent of the total. Euro-denominated assets came next at $223.1 billion, followed by yuan-denominated assets at $115.3 billion. Dollar assets increased by $224.9 billion from a year earlier, accounting for nearly two-thirds of the total increase in Korea’s external financial assets. The dollar was the largest currency across all major investment categories, making up 38.6 percent of direct investment, 74.1 percent of portfolio investment and 74.6 percent of other investment, including deposits, loans and trade credit. Korea’s external financial liabilities also rose sharply. Foreign investors’ claims on Korean assets increased by $558.0 billion to $1.98 trillion at the end of 2025. The BOK attributed the broad increase to the sharp rise in Korean stock prices, which lifted the market value of foreign-held Korean assets. The KOSPI jumped 75.6 percent in 2025, reversing a 9.6 percent decline in 2024. By region, the United States was the largest holder of Korean external liabilities at $523.1 billion, or 26.4 percent of the total. Southeast Asia followed with $391.4 billion, and the EU with $331.6 billion. By currency, won-denominated liabilities accounted for the bulk of Korea’s external financial liabilities, reaching $1.4 trillion, or 70.7 percent of the total. Won-denominated liabilities increased by $522.4 billion from a year earlier, largely reflecting the rise in the value of Korean stocks held by foreign investors. Moon said the international investment position is a stock-based statistic, meaning it reflects not only actual investment flows but also valuation gains from asset price changes. “Even if foreign investors were net sellers of Korean stocks, the sharp rise in stock prices increased the value of the shares they held, raising the stock of external financial liabilities,” he said. The data also carry implications for the currency market. The won strengthened 2.4 percent against the dollar on a year-end basis in 2025, meaning the latest data should not be read as a direct explanation of the year-end exchange rate. But a larger stock of overseas securities and dollar-denominated assets can create steady demand for foreign currency even when Korea runs current account surpluses and maintains ample foreign exchange reserves. The larger stock of won-denominated liabilities held by foreign investors could also make the currency more sensitive to market swings, as profit-taking or portfolio rebalancing can lead to demand to convert won proceeds into dollars. Moon said the increase in overseas investment by Korean residents should not be viewed negatively in itself because it expands the country’s external financial assets, while foreign capital outflows can add upward pressure to the exchange rate when investors sell Korean assets and convert the proceeds into foreign currency. The figures show that Korea’s currency movements are becoming harder to explain through trade balances or foreign exchange reserves alone, as overseas investment demand, foreign equity flows and asset-price shifts play a larger role in the financial account. 2026-06-25 15:35:50
  • World Cup 26: Korea misses automatic berth, awaits third-place verdict
    World Cup 26: Korea misses automatic berth, awaits third-place verdict SEOUL, June 25 (AJP) - South Korea failed to secure automatic qualification for the Round of 32 after losing 1-0 to South Africa, leaving their World Cup fate to the ranking of third-placed teams. South Korea were beaten at Monterrey Stadium in Mexico on Thursday morning in Korea in their final Group A match of the 2026 FIFA World Cup. In the other Group A match played at the same time, Mexico defeated Czechia 3-0. Mexico finished top of the group with three wins from three matches, while South Africa moved into second place with four points. South Korea ended third with one win and two losses, three points and a minus-one goal difference. Czechia finished bottom with one point. South Korea needed only a draw to secure second place, but they struggled against South Africa’s high press and quick wide attacks. Korea had early openings through Lee Kang-in and Kim Min-jae, but South Africa gradually took control by cutting off Lee’s left-footed passing lanes and forcing mistakes from Hwang In-beom and Paik Seung-ho in midfield. Head coach Hong Myung-bo tried to change the game at halftime by sending on Son Heung-min and Jens Castrop, but Korea still failed to break through South Africa’s pressure. Oh Hyeon-gyu produced Korea’s first shot on target with a header in the second half, but it went straight at the goalkeeper. South Africa then broke the deadlock midway through the second half. Thapelo Maseko received the ball inside the box and drove a shot through Castrop’s legs into the right side of the net. Korea used all five substitutions, bringing on Park Jin-seop, Kim Jin-gyu and Cho Gue-sung in search of an equalizer, but they never found one. In stoppage time, Park met a lobbed pass from Castrop with a back header, only for the ball to go straight to the goalkeeper. The expanded 48-team format appeared to give Korea a wider path out of the group stage, but they are once again left calculating scenarios. Under the new format, the top two teams from each of the 12 groups advance directly to the Round of 32, along with the eight best third-placed teams. South Korea finished with three points, a minus-one goal difference and two goals scored. For now, Korea remain inside the provisional cut line, but their position is far from secure. Among third-placed teams whose groups have already been completed, Scotland are below Korea with three points and a minus-three goal difference. Bosnia and Herzegovina, however, are already ahead with four points. Croatia are also ahead of Korea for now. They have three points and the same minus-one goal difference, but have scored three goals to Korea’s two. That means Korea need at least three more third-placed teams to finish with a worse record than theirs to reach the knockout stage. On the other hand, if six more third-placed teams finish above Korea, Hong’s side would fall to ninth or lower in the third-place ranking and be eliminated. Korea need as many third-placed teams as possible to stay below four points. Every third-place team that reaches four points will move ahead of Korea. Even three-point teams could be dangerous if they match Korea on goal difference and finish with more goals scored. Korea are already ahead of Scotland, but several groups from D to L still have final matches left. Depending on those results, Korea could either claim one of the final knockout spots or exit the tournament as a third-placed team. Even if Korea survive through the third-place ranking, their already-tough path has become much tougher. Canada, who had been their likely opponent had Korea finished second in Group A, are now set to face South Africa, while Korea are more likely to meet the winner of Group E or Group G depending on the final third-place allocation. Germany are the favorite to finish top of Group E, while Group G remains open among Egypt, Belgium and Iran. If Iran beat Egypt and Belgium defeat New Zealand, the group lead could come down to goal difference between Iran and Belgium. The defeat also extended Korea’s winless World Cup run against African teams since 2006. Hong, who was in charge when Korea lost 4-2 to Algeria at the 2014 World Cup, had a chance to change that narrative against South Africa. Instead, Korea were left with another damaging defeat and no control over their own fate. South Korea can no longer change the equation themselves. Their Round of 32 hopes now depend entirely on the numbers produced by the remaining group-stage matches. 2026-06-25 13:46:26
  • Korea loses to South Africa, left waiting on third-place ranking
    Korea loses to South Africa, left waiting on third-place ranking SEOUL, June 25 (AJP) - South Korea failed to secure automatic qualification for the Round of 32 after losing 1-0 to South Africa in their final Group A match at the 2026 FIFA World Cup on Thursday in Korea. South Korea lost at Monterrey Stadium in Mexico after conceding midway through the second half. In the other Group A match played at the same time, Mexico beat Czechia 3-0. The results sent Mexico through as Group A winners and South Africa as runners-up. South Korea finished third with three points and a goal difference of minus one. South Korea are currently around fourth in the ranking of third-placed teams, keeping their knockout hopes alive for now. But their place in the Round of 32 is not yet confirmed, with several groups still to complete their final matches. Hong Myung-bo’s side tried to change the game by bringing on Son Heung-min and Jens Castrop at halftime, but they again struggled to break South Africa’s pressure and conceded after being exposed down the flank. The defeat also extended South Korea’s winless World Cup run against African teams since 2006. Hong, who was in charge when Korea lost 4-2 to Algeria in 2014, missed a chance to erase part of that memory and must now wait to see whether his team can survive through the third-placed team ranking. 2026-06-25 12:05:52