Refer Report

Regarding Iran’s attack on Israel, Bank of Korea Deputy Governor Yoo Sang-dae said, “It is difficult to rule out the possibility that volatility in domestic and overseas financial markets will increase as global risk aversion sentiment strengthens.”

Vice Governor Yoo held a ‘market situation review meeting’ on the morning of the 2nd and made this announcement while examining the international financial market situation and the impact on the domestic foreign exchange and financial markets due to Iran’s attack on Israel.

Iran, which had predicted retaliation after the assassination of the head of Hamas, launched a large-scale ballistic missile targeting Israel on the evening of the 1st (local time), two months later. As Israel warns Iran of retaliation, the war crisis in the Middle East is further intensifying.

In the international financial market, as geopolitical tensions rise, preference for global safe assets has strengthened. Treasury yields and stock prices of major countries (US S&P 500 -0.9%) fell, while the US dollar (+0.4%) and international oil prices (+3.8%) showed strength.

In fact, the previous day, 10-year U.S. Treasury bonds fell by 5bp, German government bonds fell by 9bp, and British government bonds fell by 6bp.

In relation to this, Vice Governor Yoo assessed, “Although the level of Iran’s attack is assessed to be limited, global risk aversion may be strengthened depending on the availability and intensity of Israel’s response in the future.”

He predicted, “It is difficult to rule out the possibility that domestic and international financial market volatility will increase.”

Accordingly, he said, “We will operate a 24-hour monitoring system linked with overseas offices with special vigilance,” and “We plan to closely inspect the progress of the Middle East situation and the various ripple effects on domestic and foreign finance and the economy in the future.”

Reporter Kim Ye-won yen88@wowtv.co.kr

Source: Korean