South Korea’s Central Bank to provide Financial aid to eligible Banks

In an effort to calm the financial markets that have been rattled by the global Coronavirus pandemic, South Korea’s central bank has said to temporarily provide an “unlimited” amount of financial assistance to eligible banks and other financial institutions for next three months through repurchase agreements.

Saying on Thursday, March 26, that the move was unprecedented, the Bank of Korea, did not provide an estimate on how much money would be extended to financial markets through the short-term borrowings. It is also to be noted that last week, the Bank executed an emergency rate cut of 0.5 per cent points in a move to ease out the economic fallout caused due to the deadly Coronavirus or COVID-19, bringing the policy rate to an all time low of 0.75 per cent.

Several experts have said that it is unclear whether the move would provide some respite when the supply and demand of the economy have been largely hampered due to the global pandemic.

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