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The pledges came after Yim Yong-ryong, a deputy finance minister, held an emergency economic policy meeting in Gwacheon, south of Seoul, with deputy chiefs of the central Bank of Korea and the country's financial regulators, the Financial Services Commission and the Financial Supervisory Service.
The meeting was called as the country musters its efforts to bolster the local stock and currency markets battered last week by deepening worries about U.S.'s debt and fiscal deficit.
Global credit rating agency Standard and Poor's downgraded its U.S. credit rating to AA+ from AAA on Friday, a move that is expected to further pummel local stock markets when they open on Monday.
"The impact (of the rating cut) on our economy is only limited," the deputy chief said in a bid to calm investor fears. "The financial market does not need to have excessive reactions," Yim said.
The deputy finance minister also vowed his ministry would make efforts to soothe
investor sentiment and enact measures to prevent further market shocks from
external risks.
"A policy review is needed to implement timely
measures to reduce market volatilities and stabilize investor confidence," the
vice minister said.
He also pledged financial authorities would
scrutinize more tightly the country's foreign currency reserves and movements of
foreign funds in order to come up with necessary emergency market-soothing
measures when needed.
In an efforts to allay jitters over U.S.
sovereign debts, Yim also said that despite the recent downgrade, "It is hard to
find other safe assets that could serve as substitutes for U.S.
Treasuries."
Yim received confirmation that South Korea's credit
rating will remain unaffected by the recent U.S. downgrade, he added.
Source: Yonhap News (August.7, 2011)