China Extends Gold Buying Streak as Reserves Surge Despite Volatile Prices 
Trump Lifts 25% Tariff on Indian Goods in Strategic U.S.–India Trade and Energy Deal 
Singapore Budget 2026 Set for Fiscal Prudence as Growth Remains Resilient 
Asian Stocks Slip as Tech Rout Deepens, Japan Steadies Ahead of Election 
Trump Signs Executive Order Threatening 25% Tariffs on Countries Trading With Iran 
Asian Markets Surge as Japan Election, Fed Rate Cut Bets, and Tech Rally Lift Global Sentiment 
U.S.-India Trade Framework Signals Major Shift in Tariffs, Energy, and Supply Chains 
Gold and Silver Prices Climb in Asian Trade as Markets Eye Key U.S. Economic Data 
India–U.S. Interim Trade Pact Cuts Auto Tariffs but Leaves Tesla Out 
Yen Slides as Japan Election Boosts Fiscal Stimulus Expectations 
U.S. Stock Futures Rise as Markets Brace for Jobs and Inflation Data 
Vietnam’s Trade Surplus With US Jumps as Exports Surge and China Imports Hit Record 
Japanese Pharmaceutical Stocks Slide as TrumpRx.gov Launch Sparks Market Concerns 
South Africa Eyes ECB Repo Lines as Inflation Eases and Rate Cuts Loom 
UK Starting Salaries See Strongest Growth in 18 Months as Hiring Sentiment Improves 
RBI Holds Repo Rate at 5.25% as India’s Growth Outlook Strengthens After U.S. Trade Deal 
Dow Hits 50,000 as U.S. Stocks Stage Strong Rebound Amid AI Volatility 
South Korea’s household debt surged last quarter, reaching 1,896 trillion won, as mortgage loans soared by 5.9%. This increase is likely to deter the Bank of Korea from considering an interest rate cut when it meets on August 22, amid concerns over financial imbalances and rising home prices.
South Korea’s Accelerating Household Debt Likely to Keep Bank of Korea’s Rate Hike On Hold
The central bank is anticipated to refrain from indicating a near-term policy shift when authorities convene later this week, as the most recent dataset in a series of datasets shows that South Korea's household debt expanded at an accelerated pace last quarter.
The Bank of Korea announced on August 20 that total household credit increased by 1.9% from the previous year to 1,896 trillion won ($1.43 trillion) in April-June. Mortgage loans, the primary source of credit, increased by 5.9% in the prior year, reaching 1,093 trillion won.
In conjunction with an earlier BOK survey that indicated that consumers anticipate a further increase in the housing market's temperature, credit data on August 20 is expected to reinforce the consensus among economists that monetary authorities will maintain the benchmark interest rate at 3.5%, a level that is considered restrictive, when they meet on August 22.
Rising Household Debt and Seoul’s Housing Prices Fuel BOK’s Concerns Over Financial Imbalances
Last month, BOK Governor Rhee Chang-yong expressed apprehension regarding the rise in household debt, exacerbated by the continuous increase in home prices in Seoul, thereby increasing the likelihood of financial imbalances. Numerous individuals maintain most of their wealth in real estate, resulting in South Korea's household debt-to-economy ratio being among the highest in the world.
Although many economists anticipate the BOK reducing its rate in October, this prediction may be postponed if the housing market continues to exhibit warming symptoms beyond August. According to Yahoo Finance, this uncertainty and an export rally driven by artificial intelligence processors bolster policymakers' confidence in the economy's ability to continue operating despite restrictive policy settings.
On a separate note, the Financial Services Commission of South Korea announced on August 20 that the mortgage loan limit for residences in the greater Seoul area will be reduced beginning September 1. With its potential to discourage private lending, this action underscores the gravity of the situation and the caution that needs to be exercised in the future of private lending.
