Table of Contents




  2. Trade Talks Scheduled During IMF, World Bank Meetings




  4. Central Bank Holds Rates, Cuts Growth Outlook




  6. Currency Volatility Fuels Market Tension




  8. Korea Seeks Time and Stability Before Tariff Implementation





1. Trade Talks Scheduled During IMF, World Bank Meetings


South Korea will engage in crucial trade talks with the United States this week in Washington, during the spring sessions of the International Monetary Fund (IMF) and World Bank. The dialogue comes at a tense moment, as South Korea’s export-driven economy faces growing pressure from proposed U.S. tariffs and fluctuating global demand.


🇰🇷 Delegation Leaders:




  • Choi Sang-mok – Finance Minister




  • Ahn Duk-geun – Trade Minister




They are expected to meet with:




  • Jamieson Greer – U.S. Trade Representative




  • Scott Bessent – U.S. Treasury Secretary




The trade consultations were requested by the U.S., according to the Korean Trade Ministry. While no detailed agenda has been released, officials confirmed that Seoul will push back against the 25% “reciprocal” tariff announced by former President Donald Trump. Although the tariff has been paused, Korean leaders fear its reimplementation could severely damage already fragile export channels.



2. Central Bank Holds Rates, Cuts Growth Outlook


The Bank of Korea (BOK) kept its benchmark interest rate unchanged at 2.75% last Thursday, in line with economist expectations. However, the central bank delivered a grim warning: economic growth is now projected to fall below its previous 1.5% forecast for 2025.


🔍 BOK's Key Concerns:




  • Sluggish exports




  • Weak domestic consumption




  • Political uncertainty




  • Unpredictable global trade conditions




In an attempt to stabilize growth, Seoul introduced a ₩12 trillion ($8.45 billion) emergency budget earlier this month, targeting critical sectors—especially semiconductors, one of Korea’s key industries.


Despite the stimulus, the central bank emphasized a wait-and-see approach on future rate cuts, tying any decisions to evolving domestic and external trade conditions.



3. Currency Volatility Fuels Market Tension


The Korean won has experienced severe volatility, swinging dramatically since early April. Following politically charged remarks from Donald Trump on April 3, the won:




  • Strengthened to ₩1,429.52/USD on April 4




  • Dropped to a 16-year low of ₩1,487.3/USD by April 9




  • Rebounded to ₩1,411.39/USD by April 16—its highest level since December 2024




This instability has raised red flags at the central bank, which is now monitoring foreign exchange markets closely to avoid long-term capital outflows and renewed household debt crises.



4. Korea Seeks Time and Stability Before Tariff Implementation


Finance Minister Choi Sang-mok told parliament on Tuesday that South Korea is seeking to delay the implementation of the U.S. tariffs for as long as possible. “We want to delay the implementation of tariffs as long as possible,” he emphasized, noting that the extra time would offer breathing room for Korean businesses to adapt to global headwinds.


As the country prepares for an upcoming election and braces for continued U.S. trade pressure, Korean policymakers appear focused on preserving short-term economic stability while rebalancing long-term trade relationships.



📉 Outlook: Strategic Diplomacy Amid Domestic Challenges


As South Korea enters this critical negotiation phase with the U.S., the intersection of monetary policy caution, volatile exports, and currency instability paints a complex picture for Asia’s fourth-largest economy. The outcome of this week’s talks could shape the country’s fiscal trajectory for the remainder of the year—and beyond.



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