Korea to Be Finally Clear of Currency-Manipulator Watchlist

Korea is expected finally to be removed from a U.S. watchlist of currency-manipulating countries, Bloomberg reported Thursday citing American government sources.

 The U.S. Treasury Department issues a report on foreign currencies twice a year, in April and October, but the latest report has been delayed by about a month.

Korea was put on the list in the second half of 2018 along with China, Germany, India, Japan and Switzerland. Although less severe than being named a manipulator outright, being on the watchlist is a black mark against a country and makes it subject to monitoring by the U.S. government.

The criteria are whether a country's annual surplus in trade with America surpasses US$20 billion, whether it achieves a current account surplus of more than three percent of GDP, and if its government's intervention in its foreign exchange market surpasses two percent of GDP.

According to Bloomberg, the U.S. tightened one of the three criteria -- from a surplus of three percent of GDP to two percent.

Last year, Korea's current account surplus reached 4.7 percent of GDP, which meant it met one of the three criteria, though the trade surplus with the U.S. stood at only $17.9 billion, and Korean forex authorities, publishing their transaction records for the first time this March, showed they net purchased only around $190 million in 2018, which proved they were not intentionally altering the value of the won to benefit Korean exporters.