Defensive of KRW, Seoul's attention shifts to potential rate hike in Japan after U.S. rate cut SEOUL, December 11 (AJP) - A U.S. rate cut typically delivers immediate relief to Korean financial markets. This time, it barely moved sentiment. Investors quickly pivoted to risks emerging across the Pacific — namely the possibility of a Japanese rate hike that could unleash sweeping reversals of international capital leveraged through decades of zero-interest Japanese funding. As widely expected, the U.S. Federal Reserve delivered a third consecutive rate cut, lowering the federal funds rate to 3.50–3.75 percent and narrowing the gap with Korea’s base rate at 2.50 percent. A smaller interest differential usually encourages capital to remain in Korea. That pattern did not materialize. The dollar jumped 6.70 won to 1,473.30. The KOSPI fell 0.6 percent and the KOSDAQ slipped 0.04 percent on Thursday. The 10-year government bond yield inched up to 3.378 percent from Wednesday's 3.371 percent. BOJ policy and JGB yields fuel unwind fear The yen carry scare has returned. The Bank of Japan is under pressure to move on interest rates as long-term yields — those attached to financial products with maturities of one year or more — rise faster than authorities expected, heightening inflation risk. BOJ Governor Kazuo Ueda acknowledged the shift during a parliamentary budget committee session on Tuesday, reiterating earlier signals pointing toward an eventual rate hike. Japan for decades tolerated a weak yen to boost export competitiveness and fight deflation. The “yen carry trade” — in which global investors borrow cheap yen and invest in higher-yielding assets abroad — was central to this strategy. The trade thrived when Japanese interest rates stayed pinned at zero while U.S. and global rates surged during the tightening cycle. But with Japanese inflation now hitting the 2 percent target and concerns of overshooting rising, the BOJ’s stance is changing. A shift toward Japanese tightening — as the U.S. loosens — raises the risk of a carry trade unwind, which can drain capital from markets heavily reliant on foreign funds. Korea is particularly vulnerable when the won hovers near crisis-level ranges. Deputy chiefs overseeing fiscal, monetary, and financial policy convened an emergency macro-financial meeting Thursday, warning that vulnerabilities in the bond and FX markets could intensify under diverging global monetary conditions. The won fell 3.2 percent against the dollar in November, steeper than the Taiwanese dollar’s 1.9 percent decline and the Japanese yen’s 1.4 percent. Much of the downward pressure stems from a combination of rapid M2 money supply expansion and persistent net outflows stemming from individuals’ and institutions’ high overseas investment appetite. Analysts agree that a carry-trade unwind could accelerate the won’s decline but stop short of calling the situation a crisis. “Unlike last year, when yen futures were net short, this year long positions dominate. The market has already anticipated a BOJ rate hike,” said Cho Yong-gu, researcher at Shinyoung Securities. He added that for the Korean won and bond yields to stabilize, a BOJ rate hike could paradoxically be helpful, as it would calm super long-term JGB yields and prevent broader turmoil in Asian currency markets. Japanese government bond yields have been stoking unwind fears. The 10-year JGB yield has nearly doubled in a year, rising from 1.054 percent on Dec. 9, 2024 to 1.956 percent on Wednesday — surpassing the 1.87 percent level recorded in December 2008. A surge driven partly by heavy Japanese government bond issuance to fund stimulus has amplified inflation concerns, making BOJ tightening more urgent. Experts also bet on BOJ tightening Markets remain divided on the BOJ’s next move, as government and central bank signals continue to diverge. Heo Seong-woo, researcher at Hana Securities, said that expectations of rising inflation and wage growth — pushing the BOJ toward a December rate hike — have contributed to climbing JGB yields. “Core CPI, excluding fresh food, has risen to 3 percent, and super-core CPI, excluding energy, has increased to 3.1 percent. Prices are clearly climbing, and the government bond bid-to-cover ratio was poor compared to last year. The BOJ has no choice but to raise rates.” Yen market positioning also supports the case for tightening. Researcher Cho of Shinyoung noted that the yen’s exchange rate is above 155 per dollar, approaching the 162 level reached in July when the carry trade last unwound. He added that the 160 mark is considered a psychological ceiling in Tokyo markets. “We must remember that July’s unwind occurred during a decoupling — the U.S. Fed was cutting rates while the BOJ was tightening,” Cho said, arguing that another rate hike is “predictable.” 2025-12-11 17:40:17

Fine dust returns to Seoul SEOUL, December 11 (AJP) - Light rain tapered off early on the morning of December 11, but northwesterly winds carried fine dust back into the city. Viewed from Namsan in central Seoul, the skyline appeared muted and hazy beneath the incoming dust. 2025-12-11 17:38:14

Annual charity campaign gets under way SEOUL, December 11 (AJP) - With the year-end campaign to help those in need just ahead of Christmas, an installation dubbed the "charity thermometer" in downtown Gwanghwamun has been displaying its progress to encourage passersby to chip in. The thermometer stood at 37.1 degrees Celsius on Thursday, after the launch of the annual campaign by the Community Chest of Korea on the first day of this month. With this year's goal to collect 450 billion Korean won (around US$306 million), its temperature rises by one degree for every 1 percent of the fundraising target. 2025-12-11 17:37:38

PHOTOS: Experience the Beauty of Contemporary Crafts at COEX SEOUL, December 11 (AJP) - The 2025 Craft Trend Fair opened December 11 at COEX Hall A in Seoul, marking the event's 20th anniversary since its launch as the International Craft Fair in 2006. The four-day fair, running through December 14, is hosted by the Ministry of Culture, Sports and Tourism and organized by the Korea Craft and Design Foundation. It features individual craft artists, small studios, companies, domestic and international institutions, and galleries. Visitors can explore diverse craft items including tableware, kitchenware, furniture, lighting, decorative objects, vases, bags, clothing, and accessories. The fair aims to promote the popularization and industrialization of craft culture while presenting the expandability of crafts and proposing the future of craft culture. Admission is 10,000 won, with operating hours from 10:00-19:00 on December 11-13 and 10:00-18:00 on December 14. 2025-12-11 17:36:17

Yen carry trade unwind weighs on Asian stocks despite Fed rate cut SEOUL, December 11 (AJP) - Asian markets slipped or traded flat on Thursday as investors braced for a potential Bank of Japan interest rate hike and a broader unwinding of the yen carry trade. The U.S. Federal Reserve’s earlier rate cut offered limited support, with sentiment pressured further after the Fed signaled a more hawkish policy outlook that tempered hopes for additional easing. The Korean won weakened to 1,472.4 per dollar as of 4:40 p.m., down 5.8 won, amid expectations that capital could shift toward Japan should rates rise there. South Korean government bond yields were mixed. The three-year yield edged up 0.6 basis points to 3.101 percent, while the 10-year yield slipped 0.7 basis points to 3.378 percent, with both remaining above the 3 percent level. The benchmark KOSPI finished 0.59 percent lower at 4,110.62. Institutional investors drove the decline with net sales of 776.6 billion won ($520 million). Foreign investors purchased 347.2 billion won, while retail investors bought 408.8 billion won. Chipmakers led the downturn. SK hynix fell 3.75 percent to 565,000 won, while Samsung Electronics eased 0.65 percent to 107,300 won. Export-oriented names were also dragged lower: Hyundai Motor, typically a beneficiary of a weaker won, closed 2.31 percent down at 295,500 won. The day’s most active theme centered on redevelopment prospects for the Seoul Express Bus Terminal. Shinsegae climbed 4.28 percent to 256,000 won, while Dongyang Express surged 30 percent to 60,900 won and Chunil Express jumped 26.56 percent to 457,500 won. The tech-heavy KOSDAQ ended virtually unchanged at 934.64. Japan’s Nikkei 225 dropped 0.9 percent to 50,148.82 as renewed expectations of a BOJ rate increase pressured exporters and raised speculation that Prime Minister Sanae Takaichi’s stimulus plans may be put on hold. Heavy industry stocks led losses, with Mitsubishi Heavy Industries plunging 4.59 percent to 4,050 yen ($26). Automakers fared better on views they were already undervalued: Toyota dipped 0.19 percent to 3,110 yen and Honda slipped 0.22 percent to 1,572 yen. Semiconductor stocks were mixed. Advantest jumped 4.42 percent to 21,040 yen, while Tokyo Electron fell 1.57 percent to 32,600 yen. Taiwan’s TAIEX retreated 1.32 percent to 28,024.75, dragged down by chipmakers. TSMC lost 2.33 percent to 1,470 Taiwan dollars ($47), and MediaTek tumbled 4.45 percent to 1,395 Taiwan dollars, breaking below the NT$1,400 mark. Mainland Chinese markets also weakened on concerns about yen carry trade unwinding. The Shanghai Composite slipped 0.7 percent to 3,873.32, while the Shenzhen Component dropped 1.27percent to 13,147.39. Hong Kong’s Hang Seng Index was little changed at 25,530. Early gains evaporated on fears of capital outflows, but the index’s U.S. dollar peg and expectations that the Fed’s rate cut would ease valuation pressure helped limit losses. 2025-12-11 17:21:42

Monthlong winter festival to illuminate Seoul SEOUL, December 11 (AJP) - Workers were busy preparing light displays at Cheonggyecheon Stream in central Seoul on Thursday, just a day before this year’s winter-themed festival. During the annual festival, which runs until early next month, several tourist spots in downtown Seoul and nearby areas will be turning into a winter wonderland. Gwanghwamun Square, Cheonggyecheon Stream, and Bosingak Bell Pavilion will welcome visitors with glittering light displays and festive decorations. 2025-12-11 17:13:10

PHOTOS: National Museum of Korea sets all-time visitor record SEOUL, December 11 (AJP) - The National Museum of Korea's annual visitor count has surpassed 6 million for the first time in its history. The achievement underscores the growing interest in Korean history and culture both domestically and internationally, the museum said. The museum held a commemorative ceremony on Thursday to celebrate the record-breaking achievement, which was attended by Yu Hong-jun, the Director of the National Museum of Korea. This year’s record of over 6 million visitors is the highest annual attendance recorded since the museum first opened its doors on Dec. 3, 1945. 2025-12-11 16:57:24

Seoul aims to correct "misunderstanding" in public policy with live government briefings SEOUL, December 11 (AJP) - South Korean bureaucrats are often “misunderstood” as lazy or corrupt, but if such perceptions reflected reality, the country could never have advanced to the level admired by much of the world, President Lee Jae Myung said Thursday as he addressed government officials at the Sejong Government Complex for the first time since taking office in June. Again for the first time, each ministry and public office’s briefing to the president was broadcast live. “There is no need to be nervous. This will be fun,” Lee said, speaking casually to stone-faced senior officials appearing before the president and cameras. Koo Yun-cheol, deputy prime minister for the economy, reported that the government aims to lift Korea’s potential growth rate above 1.8 percent next year, emphasizing policies designed to spur corporate investment. Lee also ordered faster progress from a task force dedicated to “rationalizing punishment for economic wrongdoings,” arguing that Korean criminal law too often penalizes working-level employees rather than primary beneficiaries of misconduct. “Somewhere called ‘pang’ has broken regulations this time,” he said, referring obliquely to Coupang, which is under investigation after a massive data breach affecting more than 30 million users. Lee said such irregularities persist because penalties remain weak. Ahead of the session, ministries received internal guidelines stating that briefings would be “principally live-streamed, with Deputy Minister and Director General-level officials in attendance, and exceptions for non-disclosure made only when necessary—for example, on diplomatic or security grounds.” The televised format is part of the presidential office’s broader push toward what it describes as “discussion-based and participatory governance.” The shift has changed work rhythms in both Seoul and Sejong. Weekend work has become routine, officials say, as ministries prepare for live policy briefings. Senior officials at the Director-General level and above, who may be questioned directly by the president, are memorizing data and rehearsing answers to anticipated questions. Many are making extra efforts to avoid misstatements or hesitation in front of both the president and the public. This year’s briefing also breaks bureaucratic precedent. Such sessions are traditionally held at the start of the year, but the administration opted to convene the meeting at year’s end as part of its transparency initiative. The live-briefing series spans 19 ministries, five departments, 18 agencies, seven commissions, and 228 public institutions, along with six related organizations, including the Financial Supervisory Service. Sessions will rotate between Seoul, Sejong, and Busan in the coming weeks. 2025-12-11 16:50:46

After game-curfew flop, Seoul unlikely to adopt Australia's drastic social media ban SEOUL, December 11 (AJP) - In every advanced society — from the United States to East Asia to Australia — one common reality defines modern childhood: kids and teenagers are glued to their screens. Whether scrolling through social media, watching YouTube, or toggling between both, their digital immersion is constant. Governments are responding with varying degrees of intervention, but only a few have taken dramatic steps. Australia is now the boldest example, and one that Seoul is highly unlikely to follow. According to Britain's Ofcom, 99 percent of children now spend time online, and nine in ten own a mobile phone by age 11. The regulator warns of "a blurred boundary between the lives children lead online and the 'real world,'" describing how deeply digital habits shape childhood. Ofcom also found that three-quarters of children aged 8 to 17 who use social media have at least one account, even though most platforms set a minimum age of 13. Among 8- to 12-year-olds, six in ten maintain their own profiles. The United States shows a similar pattern. A Pew Research Center report released Tuesday found that most American teenagers use YouTube and TikTok daily, and about one in five are on one of the two platforms "almost constantly." Experts warn of risks ranging from diminished attention spans to delayed cognitive development, but few governments have enacted hard rules. Australia stands out for enforcing a complete ban on social media accounts for anyone under 16, prohibiting minors from creating or maintaining profiles on designated platforms. The measure has sparked intense debate. The Australian Human Rights Commission has warned that VPNs and fake age declarations could undermine the law and argues that an account ban "does not address the root causes of online risks or make platforms safer for everyone." For Seoul, such a prohibition would be politically and socially untenable. Korea's last attempt at sweeping digital regulation — the so-called shutdown law, which barred anyone under 16 from online gaming between midnight and 6 a.m. — was repealed in 2021 after a decade of resistance and ridicule. It had little impact on gaming habits, even as Korean gamers became world-class e-sports competitors. "I don't think parents would tolerate it," said Song Ki-chang, professor of education at Sookmyung Women's University. "Parents and children communicate through these apps these days. They check things or send messages whenever needed. I'm not sure a ban on SNS accounts is even feasible." The Ministry of Science and ICT's 2024 smartphone dependency survey shows why the concern persists but heavy-handed controls are unlikely. More than four in ten Korean adolescents fall into the "risk group" for smartphone overuse — including both high-risk and potential-risk users. Dependency risk in 2024 reached 42.6 percent among adolescents aged 10 to 19 and 25.9 percent among children aged 3 to 9, compared with 22.4 percent among adults aged 20 to 59 and 11.9 percent among seniors. The OECD notes that governments have a critical role in shaping safer digital environments, yet reliable global data on youth digital behavior remains limited, hampering evidence-based policymaking. For educators, the answer lies less in prohibition and more in resilience-building. "It's not going after the companies that can really do something, which are Apple, Google, and Microsoft," said Douglas Weir, 33, a principal at an international school in Seoul. Larger schools face greater challenges in monitoring usage, he said, but the underlying problem is universal. "When we were kids, we had to learn how to use search engines and computers for the first time. The same conversations were happening then about whether it was appropriate or dangerous. I don't think we're going to solve this overnight — but the approach needs to be about educating kids, not banning." 2025-12-11 16:43:38

Workers trapped after collapse at construction site in Gwangju SEOUL, December 11 (AJP) - A steel structure collapsed at a construction site in the southwestern city of Gwangju on Thursday, leaving several workers trapped. According to emergency rescue officials, the incident occurred at around 1:58 p.m. at a construction site for a library, with four workers trapped under the debris. One person was rescued shortly after the collapse but is presumed dead. Search and rescue operations are underway for the remaining three workers. Police and government authorities plan to investigate the exact cause of the accident after completing the rescue operations. * This article, published by Aju Business Daily, was translated by AI and edited by AJP. 2025-12-11 16:26:16