The Bank of South Korea keeps interest rates unchanged
The Bank of South Korea announced after the interest rate meeting to maintain interest rates unchanged at a record low of 0.5%, in line with market expectations. The statement after the meeting pointed out that the central bank currently needs to assess the negative effects of interest rate cuts because of the possible adverse effects. The market estimates that this may be related to the property market’s upward trend in recent years. In the past three years, the South Korean government has launched a total of 23 different tricks, but the property prices in Seoul have not fallen. As of July, the average apartment price in Seoul has exceeded 1 billion won, an increase of 52% compared to three years ago. Faced with high property prices, it is expected to limit the room for the South Korean Central Bank to further cut interest rates in the future, which may support the performance of the Korean won in the short term.
Gold price rebound blocked
During the Asian session on Wednesday, spot gold weakened slightly and fell back to the 1900 position, giving up most of Wednesday’s gains. Although the dollar’s rally was blocked overnight and bargain hunting appeared in the gold market, the gold price provided some opportunities for a short-term rebound. But the market increasingly believes that the United States will not launch a new round of stimulus plans before the election. The new crown epidemic in Europe and the United States has further worsened, which has also pushed up the safe-haven buying demand of the US dollar. The risk of Britain’s Brexit has declined, all of which put gold prices facing further downside risks.
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