Bank of Korea board member Hwang Kun-il has signaled that the central bank will tighten its surveillance of financial stability risks, pointing to persistent pressures in the housing market and a surge in leveraged stock investments.
Hwang noted that volatility in both financial and foreign exchange markets increased during the first half of the year, underscoring the need for closer oversight.
The comments reflect growing concern among policymakers about the intersection of household debt and speculative trading.
Hwang’s remarks align with previous warnings from the Financial Services Commission, which has cautioned against the rapid expansion of leveraged ETFs and their potential to amplify market swings.
The central bank’s stance suggests that regulatory scrutiny of retail investment products may intensify if leverage levels continue to rise.
For investors, the warning highlights a potential headwind for Korean equities, particularly in sectors sensitive to retail trading activity.