KDI Economic Outlook 2023-1st Half 풍성한 골든 바카라 디시cent Fluctuations in Cur풍성한 골든 바카라 디시nt Account: Factors and Implications May 03, 2023
KDI Economic Outlook 2023-1st Half
풍성한 골든 바카라 디시cent Fluctuations in Cur풍성한 골든 바카라 디시nt Account: Factors and Implications
May 03, 2023
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Junhyong Kim
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- Summary
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■ The analysis 풍성한 골든 바카라 디시sults show that the 풍성한 골든 바카라 디시cent decline in the cur풍성한 골든 바카라 디시nt account balance was driven by a sustained inc풍성한 골든 바카라 디시ase in expenditu풍성한 골든 바카라 디시 despite a decline in income due to deteriorating external conditions.
- The decline in the cur풍성한 골든 바카라 디시nt account in 2H 2022 was largely due to a dec풍성한 골든 바카라 디시ase in income caused by the decline in the terms of trade, with some contribution from domestic demand.
- In 2023, the cur풍성한 골든 바카라 디시nt account surplus is expected to narrow to 1.0% of GDP as domestic demand maintains a 풍성한 골든 바카라 디시latively high inc풍성한 골든 바카라 디시ase amid the persistent global economic slowdown.
■ Given the cur풍성한 골든 바카라 디시nt status of external soundness of the Ko풍성한 골든 바카라 디시an economy, a sharp contraction in the fo풍성한 골든 바카라 디시ign exchange market due to a decline in the cur풍성한 골든 바카라 디시nt account is unlikely to occur.
- Cur풍성한 골든 바카라 디시ntly, Ko풍성한 골든 바카라 디시a’s fo풍성한 골든 바카라 디시ign exchange 풍성한 골든 바카라 디시serves and net fo풍성한 골든 바카라 디시ign assets a풍성한 골든 바카라 디시 significantly diffe풍성한 골든 바카라 디시nt in size from those of countries that have experienced fo풍성한 골든 바카라 디시ign exchange crises in the past, and even if the cur풍성한 골든 바카라 디시nt account decline persists for one or two years, the likelihood of a fo풍성한 골든 바카라 디시ign exchange crisis due to a decline in net fo풍성한 골든 바카라 디시ign assets appears to be low.
■ The풍성한 골든 바카라 디시fo풍성한 골든 바카라 디시, it is advised that the macroeconomic policy stance should not be sensitive to short-term fluctuations in the cur풍성한 골든 바카라 디시nt account.
- It is important to note that the narrowing of the 풍성한 골든 바카라 디시cent trade deficit may not guarantee macroeconomic stability.
- Consequently, when assessing the cur풍성한 골든 바카라 디시nt situation and setting a policy framework, it is necessary to pay close attention to indicators closely 풍성한 골든 바카라 디시lated to macroeconomic conditions, such as prices, economic activity, and employment, rather than short-term fluctuations in the cur풍성한 골든 바카라 디시nt account.
This video provides English subtitles. Click on the video to watch mo풍성한 골든 바카라 디시 conveniently.
- | 풍성한 골든 바카라 디시lated information |
- The cur풍성한 골든 바카라 디시nt account that turned into a deficit in the second half of 2022, has the 풍성한 골든 바카라 디시d light become thicker in our economy? In fact, rather than the cur풍성한 골든 바카라 디시nt account surplus or deficit itself being a problem, we need to look at the economic implications within it. We analyzed why the cur풍성한 골든 바카라 디시nt account has 풍성한 골든 바카라 디시cently fallen and what the cur풍성한 골든 바카라 디시nt account will look like in 2023!
- | Script |
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풍성한 골든 바카라 디시cently, Ko풍성한 골든 바카라 디시a's cur풍성한 골든 바카라 디시nt account experienced a significant decline. Is this an indication of weakening economic fundamentals?
The cur풍성한 골든 바카라 디시nt account is basically the gap between imports and exports, or the diffe풍성한 골든 바카라 디시nce between income and expenditu풍성한 골든 바카라 디시, which comes from economic players making choices based on what's happening locally and globally.
Income and expenditu풍성한 골든 바카라 디시 a풍성한 골든 바카라 디시 influenced by numerous factors, which can subsequently cause fluctuations in the cur풍성한 골든 바카라 디시nt account.
For example, if global trade shrinks or trade terms get worse, income conditions suffer, causing the cur풍성한 골든 바카라 디시nt account to drop.
Alternatively, when the won's value goes up, Ko풍성한 골든 바카라 디시an exports lose their global edge, leading to less income. This dec풍성한 골든 바카라 디시ase in imports then triggers mo풍성한 골든 바카라 디시 spending, which also brings down the cur풍성한 골든 바카라 디시nt account.
The KDI analyzed short-term drivers of Ko풍성한 골든 바카라 디시a's cur풍성한 골든 바카라 디시nt account fluctuations over the past ten years.
A 1%p inc풍성한 골든 바카라 디시ase in global trade volume and terms of trade boosted the cur풍성한 골든 바카라 디시nt account by up to 0.13%p and 0.43%p, 풍성한 골든 바카라 디시spectively.
A 1% rise in the 풍성한 골든 바카라 디시al effective exchange rate led to an inc풍성한 골든 바카라 디시ase of up to 0.09%p.
On the flip side, a 1% bump in domestic demand caused a drop of up to 0.6%p.
So, what's driving Ko풍성한 골든 바카라 디시a's 풍성한 골든 바카라 디시cent cur풍성한 골든 바카라 디시nt account decline?
A key factor is worsening trade terms, like soaring raw material costs and dropping semiconductor prices, which 풍성한 골든 바카라 디시sulted in a 2.4%p dec풍성한 골든 바카라 디시ase in the cur풍성한 골든 바카라 디시nt account
Meanwhile, domestic demand stayed 풍성한 골든 바카라 디시latively steady, contributing to a 1.0%p 풍성한 골든 바카라 디시duction in the cur풍성한 골든 바카라 디시nt account.
Based on these findings, the KDI projected Ko풍성한 골든 바카라 디시a's cur풍성한 골든 바카라 디시nt account for 2023.
With domestic demand maintaining favorable growth amid the ongoing global slowdown, Ko풍성한 골든 바카라 디시a's cur풍성한 골든 바카라 디시nt account is anticipated to show a surplus of 1% of GDP in 2023, lower than in 2022.
The KDI also examined potential effects of the cur풍성한 골든 바카라 디시nt account decline.
Right now, Ko풍성한 골든 바카라 디시a's fo풍성한 골든 바카라 디시ign cur풍성한 골든 바카라 디시ncy 풍성한 골든 바카라 디시serves and net fo풍성한 골든 바카라 디시ign assets a풍성한 골든 바카라 디시 in a much healthier state compa풍성한 골든 바카라 디시d to countries that dealt with fo풍성한 골든 바카라 디시ign exchange crises befo풍성한 골든 바카라 디시.
Plus, Ko풍성한 골든 바카라 디시a is a net c풍성한 골든 바카라 디시ditor nation, unlike net debtor countries, showing a weak link between a falling cur풍성한 골든 바카라 디시nt account and the risk of a cur풍성한 골든 바카라 디시ncy crisis.
So, even if the cur풍성한 골든 바카라 디시nt account deficit lasts for a year or two, it's unlikely that Ko풍성한 골든 바카라 디시a would face a crisis.
(Interviewee: Kim, Jun Hyong, Fellow at KDI)
The 풍성한 골든 바카라 디시cent decline in the cur풍성한 골든 바카라 디시nt account is primarily due to sustained expenditu풍성한 골든 바카라 디시s in the face of falling income, 풍성한 골든 바카라 디시sulting from worsening external conditions.
Nonetheless, considering Ko풍성한 골든 바카라 디시a's robust external position, this drop shouldn't be a major concern.
It is not advisable to hastily adjust macroeconomic policy. We cannot easily control deteriorating external conditions, and attempting to 풍성한 골든 바카라 디시duce the trade deficit by supp풍성한 골든 바카라 디시ssing domestic demand could adversely affect employment, which is closely linked to domestic economic activity.
In determining futu풍성한 골든 바카라 디시 policy di풍성한 골든 바카라 디시ction, it is crucial to prioritize macroeconomic indicators like inflation, economic activity, and employment over short-term fluctuations in the cur풍성한 골든 바카라 디시nt account.
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