Research Staff

Research Staff

LEE, Seungho Senior Research Fellow Macro-Financial Analysis


Ph.D., Economics, American University, 1996
MA, Economics, American University, 1993
Business Administration, Yonsei Univ. 1989
Professional Experience
Senior Research Fellow, Korea Capital Market Institute, 2011.1~
Senior Economist, IMF(APD), 2006.1~2009.1
Deputy Head, The Bank of Korea, 1989.1~2010.12



A Thought on Interest Rate Reversals between Korea and the US, and the Implications / Jul. 25, 2023
The US Fed's steep rate hike has sparked a rate reversal between Korea and the US. The rate reversal–the largest one compared to the past–is expected to persist for a considerable period of time going forward. Accordingly, concerns have been raised about possible capital outflows from Korea. However, the data on equity and debt portfolio flows by residents and non-residents during past rounds of rate reversal in Korea suggest that a rate reversal is unlikely to be a direct cause to capital outflows. However, rate reversals–if they continue further–could increase in the cost of financing foreign capital, which requires preparation. Specifically, costs may arise when residents attempt to hedge exchange risk from their outward portfolio investment by raising foreign capital in the FX swap market, a scenario that did not occur in the past. This needs considering as part of an FX hedging strategy.
A Thought on Downside Risks to the Korean Economy in 2023 / Jan. 17, 2023
As persistent external uncertainties and the threat of stagflation are expected to keep raising interest rates this year, the Korean economy is likely to face financial market strains, owing to rising household debt payment pressures, the spike in corporate financing costs and the decline in property prices. In light of these developments, monetary policy, one of the key pillars of macroeconomic policy, should be geared toward minimizing the real economy’s contraction and sustaining financial stability as well as recovering price stability. In terms of fiscal policy, Korea should expand spending to facilitate private investment and improve productivity in the corporate sector. Also necessary is to maintain fiscal soundness and shore up sovereign creditworthiness in preparation for external uncertainties. Additionally, it needs to bolster international cooperation frameworks in consultation with other economies to better deal with geopolitical risks while stepping up efforts to establish economic security.
Structural Characteristics and Advancement of the Korean Won FX Market / Aug. 09, 2022
Korea’s foreign exchange market has achieved quantitative growth at a slower pace than the demand for foreign exchange transactions. It has a structural characteristic that offshore NDF transactions by non-residents boost foreign exchange volatility. The recent government plan for improving the FX market aims to permit foreign investors to participate in the domestic market and extend trading hours. If the plan is implemented, Korea’s spot exchange market would partially accommodate the demand for NDF transactions by offshore market participants, thereby facilitating liquidity provision and alleviating exchange rate volatility. It is also expected to enhance foreign investors’ confidence in the Korean won FX market. In the medium and long term, Korea should exert continuous efforts for the advancement of the FX market to ensure that the Korean won is freely traded in major global financial hubs.
Need and Directions for the Foreign Exchange Transactions Act Reform Amid Changing Macroeconomic Conditions / Mar. 22, 2022
Korea’s Foreign Exchange Transactions Act has contributed significantly to stabilizing the balance of payments and achieving external soundness. However, rapidly changing macroeconomic conditions in Korea and abroad have reinforced the need for a sweeping revision of the Act. Korea has already shifted from a nation with a foreign exchange shortage to a capital exporter. International capital transactions and non-banking financial institutions have increased their presence in Korea’s foreign transactions. Furthermore, the development of growth engines in the aging society is regarded as a challenge of paramount importance. Under these circumstances, it would be desirable to amend the existing Foreign Exchange Transactions Act, with the focus on improving convenience and autonomy in FX transactions, strengthening non-banking financial institutions’ capability in the FX and external sectors, creating growth engines through more effective inbound and outbound investment, and overhauling the legal framework to sustain external soundness.

Seminar Presentation