Mortgage rates doubled amid a sharp rise in US interest rates, Japan chose to stimulate the economy by maintaining ultra-low interest rates, and Korea leaned toward stimulus by allowing interest rates to reverse.
In the US financial markets, stock markets fell sharply as the Federal Reserve raised interest rates to tackle inflation, while mortgage rates continued to soar.
The Washington Post reported on the 17th that "the most popular 30-year fixed-rate mortgage on the home loan, the most popular home loan in November, doubled to 5.78% this week from just 3%, costing hundreds of thousands of dollars in additional costs."
"It could lead to a pause in spending by Americans and a sharp cooling of the housing market, adding to concerns that the Fed's actions could help spur a recession this year or next," the report said.
Yomiuri said on the 17th, "Domestic inflation is on an upward trend, but the Bank of Japan has determined that it is necessary to support the economy cooled by the corona disaster." It will become clear.”
The Bank of Japan announced the results of the monetary policy meeting on the 17th, and the Japanese media generally said, "The Bank of Japan is expected to decide to maintain large-scale monetary easing." "The difference in interest rates between Japan and overseas will continue to widen, “There is a risk of proceeding with self-imposed depreciation.”
In response to a question about the possibility of a possible reversal of interest rates in the US and Korea, Bank of Korea Governor Lee Chang-yong said on the 16th, "It is true that the rate of increase is fast because Fed Chairman Jerome Powell expects 3.4% by the end of the year. The impact must be evaluated comprehensively," he said, 'maintaining low interest rates, reversing interest rates'.
President Yoon Seok-yeol, in his 'Announcement of the New Government's Economic Policy Direction' on the 16th, said, "The more difficult and the more we are in crisis, the more we need to completely change the constitution of our economy, led by the private sector and the market." And we will drastically improve regulations,” he said, supporting Republican Reaganomics' 'tax cuts and lower interest rates'.
At a macroeconomic and finance meeting on the 16th, Deputy Prime Minister Choo Kyung-ho said, “We will maintain special vigilance against excessive volatility of the won and promote the government’s emergency buyback (early redemption of government bonds) and simple purchase of government bonds by the BOK if the bond market reacts excessively.” He said that he was “reliant on low interest rates.”
The Bank of England, the central bank of the UK, raised the key interest rate by 0.25 percentage points to 1.25% on the 15th, raising it for the fifth time in a row.
The Swiss central bank raised the benchmark interest rate by 0.5 percentage points on the 15th to -0.25% for the first time in 15 years.
30-year fixed-rate mortgages on U.S. home loans jumped to 5.78% this week, up from 5.23% a week ago, the biggest gain in a week since 1987.
The Fed raised interest rates at the fastest rate since 1994, driven by Reaganomics, to curb rising inflation for the first time in 40 years.
The Bank of Korea (BOK) announced on the 17th in its 'Economic Outlook for May' that "in the future, housing sales prices will show a modest upward trend due to the government's easing of tax and loan regulations, and expectations for reconstruction and redevelopment."
In the US, interest rates are rising, the stock market is crashing in investors' dreadful decline, and the value of retirement accounts is plummeting.
"People who want to buy a house or young people who want to buy a house need to reconsider," Fed Chairman Powell said at a press conference on the 15th. It is becoming increasingly difficult to achieve a ‘soft landing of the economy,’ which suppresses inflation without causing an economic recession,” he said.
Reuters reported on the 16th that Taiwanese TSMC will introduce 'High Numerical Aperture (NA) EUV', the next-generation extreme ultraviolet (EUV) exposure equipment of Dutch equipment maker ASML, in 2024.
Samsung Electronics Vice Chairman Lee Jae-yong visited ASML on the 14th to purchase equipment, and it seems to have been pushed back by TSMC.
ASML in the Netherlands exclusively produces EUV exposure equipment essential for ultra-fine semiconductor processes under 7 nm and signed a contract with Intel in the United States earlier this year.
The Wall Street Journal reported on the 10th that "Samsung Electronics' foundry 4nm process semiconductor yield (pass rate) improvement was slower than expected, so chips were not supplied, so key customers such as Qualcomm and Nvidia turned their orders to TSMC." fell, and it was below 60,000 won on the 17th.
The Bank of Japan announced on the afternoon of the 17th that it would maintain its short-term interest rate of -0.1% and continue its monetary easing policy to purchase long-term government bonds.
Japan's consumer price index rose 2.1% year-on-year in April, and Korea's consumer price index rose 5.4% after subtracting one-third of the cost of living in Japan and the US, which is four times higher than Japan's.