South Korea’s central bank halted a string of interest rate cuts yesterday, deciding to keep borrowing costs at a record low 2 percent amid efforts to lift Asia’s fourth-largest economy out of recession.
The Bank of Korea left its benchmark seven-day repurchase rate unchanged at a regular policy meeting after slashing it six times since Oct. 9 to a series of record lows. A full 1 percentage point cut in December was its biggest reduction ever.
In a brief statement, the bank’s seven-member monetary policy committee painted a bleak picture of South Korea’s slumping economy.
“Domestic economic activity has kept on declining due to the continued decrease in both domestic demand and exports,” the committee said. “The downside risk to economic growth is considered to have been greatly heightened by the deepening global economic slump and the international financial market unrest.”
But it said that inflation, while recently moving higher because of weakness in the South Korean won, is likely to moderate due to the economic downturn. The bank also said that bank lending to households and small and medium-sized businesses has increased.
South Korea’s GDP shrank 3.4 percent in the final quarter of last year as manufacturing and exports wilted. The economy grew 2.5 percent last year, its worst performance since an annual contraction of 6.9 percent in 1998 when the country was battling the Asian financial crisis.
The government expects the economy to shrink 2 percent this year, but private estimates expect it will shrink more.
EXPRESSING GRATITUDE: Without its Taiwanese partners which are ‘working around the clock,’ Nvidia could not meet AI demand, CEO Jensen Huang said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and US-based artificial intelligence (AI) chip designer Nvidia Corp have partnered with each other on silicon photonics development, Nvidia founder and CEO Jensen Huang (黃仁勳) said. Speaking with reporters after he met with TSMC chairman C.C. Wei (魏哲家) in Taipei on Friday, Huang said his company was working with the world’s largest contract chipmaker on silicon photonics, but admitted it was unlikely for the cooperation to yield results any time soon, and both sides would need several years to achieve concrete outcomes. To have a stake in the silicon photonics supply chain, TSMC and
‘DETERRENT’: US national security adviser-designate Mike Waltz said that he wants to speed up deliveries of weapons purchased by Taiwan to deter threats from China US president-elect Donald Trump’s nominee for US secretary of defense, Pete Hegseth, affirmed his commitment to peace in the Taiwan Strait during his confirmation hearing in Washington on Tuesday. Hegseth called China “the most comprehensive and serious challenge to US national security” and said that he would aim to limit Beijing’s expansion in the Indo-Pacific region, Voice of America reported. He would also adhere to long-standing policies to prevent miscalculations, Hegseth added. The US Senate Armed Services Committee hearing was the first for a nominee of Trump’s incoming Cabinet, and questions mostly focused on whether he was fit for the
IDENTITY: Compared with other platforms, TikTok’s algorithm pushes a ‘disproportionately high ratio’ of pro-China content, a study has found Young Taiwanese are increasingly consuming Chinese content on TikTok, which is changing their views on identity and making them less resistant toward China, researchers and politicians were cited as saying by foreign media. Asked to suggest the best survival strategy for a small country facing a powerful neighbor, students at National Chia-Yi Girls’ Senior High School said “Taiwan must do everything to avoid provoking China into attacking it,” the Financial Times wrote on Friday. Young Taiwanese between the ages of 20 and 24 in the past were the group who most strongly espoused a Taiwanese identity, but that is no longer
A magnitude 6.4 earthquake and several aftershocks battered southern Taiwan early this morning, causing houses and roads to collapse and leaving dozens injured and 50 people isolated in their village. A total of 26 people were reported injured and sent to hospitals due to the earthquake as of late this morning, according to the latest Ministry of Health and Welfare figures. In Sising Village (西興) of Chiayi County's Dapu Township (大埔), the location of the quake's epicenter, severe damage was seen and roads entering the village were blocked, isolating about 50 villagers. Another eight people who were originally trapped inside buildings in Tainan
RSS