Government to unveil strong measures to curb rising household debt

Описание: 문재인 정부 '가계부채 관리 5년 계획', 베일 벗는다
In a short while,... the government and the ruling party will be sitting down to discuss the country's ever-rising household debt issue -- that currently tops 1-point-2 trillion U.S. dollars -- and ways to curb that figure by adjusting cheap loans.
And with the government just a day away from rolling out comprehensive measures on the issue,... it looks as though,... the news won't be welcomed by many... especially those who've recently taken out mortgages-- as the central bank is indicating it will hike rates in the coming months.
Kim Min-ji reports.
The Moon Jae-in administration will be pulling out the stops to curb the country's mounting household debt.
Set to be unveiled Tuesday,... the measures are expected to put tighter controls on loans,... as well as tougher regulations on owning multiple homes.
It's also expected to provide support for those who are financially vulnerable, such as the self-employed, low-income households and people with low credit scores.

(Oct. 20, 2017)
"We are seeking various ways to put the brakes on the double-digit growth of household debt,... and bring it down to the single digits."

The country's debt stood at over 1-point-2 trillion U.S. dollars... as of the end of June,... up more than 10 percent from a year earlier.
Government officials say the measures will provide a glimpse into how the administration plans to tackle the issue over the next five years.

However, it's not all good news,... with mounting speculation that the Bank of Korea may raise its key interest rate in the coming months,... which currently sits at a record low of 1-and-a-quarter percent.
Last week, the central bank raised the country's economic growth forecast for this year to three percent,... with the BOK governor saying conditions are becoming ripe to pull back on monetary easing.
Although low interest rates have been one of the factors blamed for growing household debt,... a rise in the policy rate will quickly mean higher payments for borrowers,... causing them even more difficulty.
Hyundai Research Institute says a one-percentage-point rise in the policy rate will lead to a maximum rise of 3 percentage points in interest on loans.
If the central bank raises it by a quarter point, interest on loans will go up by between half a point and three quarters of a point.
Experts say, in view of the government's forthcoming measures,... the timing of any interest rate hike needs to be carefully managed,... and that both external and internal factors need to be taken into consideration.
They're calling for soft-landing measures from the government that would stabilze household debt... as well as reduce lending.
Kim Min-ji, Arirang News.


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