Seoul: The government will closely monitor domestic and offshore financial markets for any increased volatility as U.S. President Donald Trump's letters to major trading partners on his tariff plans may have exacerbated market uncertainties, Seoul's vice finance minister said Tuesday.
According to Yonhap News Agency, First Vice Finance Minister Lee Hyoung-il stated during an emergency meeting that the government will maintain close cooperation with relevant agencies to monitor developments related to U.S. tariffs and their impact on financial markets and the real economy. Lee, currently acting as the finance minister, emphasized the importance of taking immediate and bold action if market volatility deviates from economic fundamentals.
The ministry observed that global financial markets experienced increased volatility following Trump's dispatch of tariff letters to 14 countries, including South Korea and Japan. The letters also extended the deadline for tariff negotiations to August 1, whereas a 90-day suspension of the U.S.' reciprocal tariffs was initially set to expire on Tuesday (U.S. time).
In a specific communication to South Korean President Lee Jae Myung, Trump announced a 25 percent reciprocal tariff on Korean products starting August 1. However, he suggested that adjustments might be feasible if Seoul removes its tariff and non-tariff policies and trade barriers.
Overnight, Wall Street closed lower, and the U.S. dollar strengthened against other currencies, reflecting uncertainties surrounding U.S. tariff policies.