Korea Business News Agency - NSP NEWS AGENCY.

(Seoul=NSP NEWS AGENCY) = As the US released mixed economic indicators and adjusted the number of interest rate cuts this year from three to one, uncertainty about the direction of interest rates has increased. Accordingly, the banking industry is also responding with difficulty regarding household loans that have been increasing rapidly recently. This is because the only way to stop the increase in loans is to worsen loan products.

On the 14th, the financial sector responded that the timing of the Bank of Korea’s base rate cut has also become uncertain due to the U.S. interest rate decision and revision of economic indicators.

The U.S. FOMC(Federal Open Market Committee) froze an interest rate at 5.25-5.5% and adjusted the number of an interest rate cut this year from three to one. However, it revised upward the PCE(personal consumption expenditures) and did not adjust the economic growth rate or unemployment rate.

This has put the BOK in a quandary about when to cut the interest rate. The real estate market has been moving in anticipation of the interest rate cut, but the recent surge in household debt makes it difficult to move quickly. According to the BOK, household loans from banks increased by nearly 11 trillion won in April and May, reaching a balance of 110.9 trillion won at the end of May.

In this situation, with the prospect of the interest rate cut in the second half of the year growing, financial authorities called in the five major commercial banks and the Bank of Korea to hold an unscheduled ‘household debt review meeting’ to discuss measures.

By Soon-ki Lee(s8789@nspna.com) and Soo-in Kang(sink606@nspna.com)

ⓒNSP News Agency·NSP TV. All rights reserved. Prohibits using to train AI models.