The Impact of Residents’ Overseas Investment on Domestic Swap Rate and Local Exchange Rate
Kang, Tae Soo; Jeong, Young Sik; Kim, Kyunghun; Kang, Eunjung | May 2020
Abstract
Korean residents’ overseas portfolio investment has increased sharply since the year of 2011. Overseas portfolio investment has increased from $100 billion in 2000 to $498 billion (equity securities $294 billion, debt securities $204 billion) in March 2019. The trend is expected to continue due to macroeconomic conditions (low interest rates, expansion of savings over retirement), government policies (activation and deregulation related to overseas investment), and institutional changes (introduction of IFRS in the insurance industry). The trend will have influences on the Korean financial market through various channels. In particular, it is likely to affect the FX market, FX swap market and the external macro-prudential status (short term external debt). Thus it is necessary to analyze the effects and prepare for risks in advance. This study is aimed at presenting policy implications for stabilizing the FX market and FX swap market through empirical studies.
Citation
Kang, Tae Soo; Jeong, Young Sik; Kim, Kyunghun; Kang, Eunjung. 2020. The Impact of Residents’ Overseas Investment on Domestic Swap Rate and Local Exchange Rate. © Korea Institute for International Economic Policy. http://hdl.handle.net/11540/12152.ISSN
2233-9140
Keywords
Public Financial Management
Financial System
Financial Statistics
Financial Stability
Financial Management System
Financial Restructuring
Capital Market Development
Market Development
Economics
Erosion
International Economics
Macroeconomic
Macroeconomic Analysis
Performance Evaluation
Impact Evaluation
Foreign and Domestic Financing
Foreign Direct Investment
Financial Statements
Pension Funds
Mutual Funds
Social Equity
Financial Aspects
Fiscal Policy
International Financial Market
Multilateral Financial Institutions
Economic Recession
Market
Crisis
Economic indicators
Growth models
Gross domestic product
Macroeconomics
Economic forecast
Business Financing
Investment Requirements
Digital currency
Labor policy
Manpower policy
Business recessions
Multilateral development banks
Regulatory reform
Capital
Exports
Economic development projects
Economic policy
Economic forecasting
Investment Requirements
Banks
International banks and banking
Capital movements
Central banks and banking
Bills of exchange
Swaps
Banks and banking
Financial crisis
Credit control
Credit allocation
Capital market
International liquidity
Liquidity
Exchange rate
Pension plans
Individual retirement accounts
Employee pension trusts
Investment management
Investments
Multiemployer pension plans
Keogh plans
Individual retirement accounts
Pension plans
Employee pension trusts
Pension trusts
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