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BOK Issue

BOK Issue Note The Effects of Overseas Investment and Investment Income on the Exchange Rate [BOK Issue Note 2026-15] 1. Korea’s overseas investment has increased sharply in recent years, led by portfolio investment. In 2025, direct investment declined to USD 41.2 billion from USD 49.7 billion in 2024, whereas portfolio investment reached USD 140.3 billion, more than double the USD 67.0 billion recorded in 2024. As a result, the ratio of portfolio investment to GDP also rose sharply, from 3.6% (2024) to 7.5% (2025). The expansion of overseas investment leads to the accumulation of external assets and an increase in net external financial assets; over the long run this is positive in that it helps expand investment income receipts, enhance the buffer of foreign currency liquidity, and strengthen external payment capacity. At the same time, Korea’s recent portfolio investment has expanded somewhat steeply, with both its scale and its ratio to GDP overtaking those of Japan (USD 102.8 billion, 2.3% in 2025). 2026. 07. 16
BOK Issue Note Evaluation of the Economic Effects of People`s Livelihood Recovery Consumption Coupons [BOK Issue Note 2026-13] ① The People’s Livelihood Recovery Consumption Coupons were incorporated into the 2025 supplementary budget to stimulate household consumption and boost sales for small business owners, with KRW 13.522 trillion distributed to all citizens. In practice, around 70% of the coupons were issued through credit cards, while the remainder were provided in the form of Local Love Gift Certificates and prepaid cards. To evaluate the economic effects of the coupons, this paper analyzes their direct effects in terms of sales growth at eligible merchants and the stimulation of household consumption. First, we examine the sales-boosting effect using large-sclae credit card sales data from six card companies*(Local Love Gift Certificates and prepaid cards are excluded from the analysis). In addition, we assess the consumption-stimulating effect based on two-waveAugust 13-20, 2025(1st) and October 27-November 7, 2025(2nd) self-reported surveys**. 2026. 07. 08
Blog Does AI Adoption Improve Productivity? It has been nearly three years since ChatGPT launched. AI has already become an irreplaceable tool for many workers. It is no longer unusual to ask AI to draft a report or to use AI for data analysis. In fact, as of 2025, more than half of employed persons in Korea (51.8%) are using generative AI at work, and this pace is as much as eight times faster than the diffusion of the Internet in the past[Figure 1]. 2026. 07. 22
Speeches Governor Hyunsong Shin at the ECB Forum on Central Banking 2026 Governor Shin presented a paper titled "A unified ledger in practice: lessons from Project Hangang" at the European Central Bank Forum on Central Banking 2026. The video(Seesion 4, 1:07:48) can be accessed via the following link. 2026. 07. 01
Speeches Speech Commemorating the Bank's 76th Anniversary by Governor Shin Hyun Song Distinguished colleagues of the Bank of Korea, Today marks the 76th anniversary of the founding of the Bank of Korea. I would like to take this opportunity to express my deepest gratitude to our predecessors, who have devoted themselves to the development of both the Bank of Korea and our economy since the Bank’s establishment. I would also like to extend my sincere appreciation to the members of the Monetary Policy Board for their leadership in monetary policy, to all our staff members who continue to give their best in their respective roles, and to the families whose steadfast support makes their dedication possible. 2026. 06. 24
BOK Issue Note Does AI Adoption Improve Productivity? Effects Over the First Three Years [BOK Issue Note 2026-12] ① As generative AI rapidly diffuses across the economy, expectations for a productivity revolution are growing, yet macroeconomic productivity indicators have not yet shown clear improvement. Using a household survey, this paper empirically examines whether AI adoption generates potential productivity gains through reductions in work time, and whether such time savings translate into realized output growth. 2026. 06. 24
BOK Issue Note The Missing Men: The Downward Trend in Male Youth Labor Force Participation The labor force participation rate of male youth, ages 25‑34, declined from 89.9% in 2000 to 82.3% in 2025, indicating a substantial decrease relative to the most advanced economies. In particular, the decline in labor force participation among Millennial men (born 1981-95) persists into their late 30s. We examine this phenomenon through three key lenses: (i) shifts in the competitive structure among youth, (ii) transformations of industrial structure, and (iii) the impacts of population aging and the AI diffusion on labor market entry for youth. 2026. 04. 28
BOK Issue Note Structural Change in Korea’s External Sector and Its Implications on the Exchange Rates Traditionally, a current account surplus has been understood to reflect enhanced competitiveness of domestic goods and expanded net exports, accompanied by a falling real exchange rate (KRW appreciation). However, since 2023 Q2, Korea has experienced a prolonged episode in which a widening current account surplus has coincided with a rising real exchange rate (KRW depreciation). Since the Global Financial Crisis, the composition of Korea’s overseas assets has tilted toward private-sector portfolio investment, and away from public-sector reserve assets. This shift has occurred alongside rising savings and slowing domestic investment associated with demographic aging. Since the current account simultaneously reflects the outcome of net exports and net capital outflows, this structural change in external asset accumulation suggests that the factors driving fluctuations in the current account and the real exchange rate may have changed. 2026. 04. 20
BOK Issue Note Life-Sustaining Treatment, Whose Decision: Discrepancies Between Patient Preferences and Medical Reality, and Policy Implications In order to safeguard patients’ right to self-determination and dignity, Decisions on Life-Sustaining Treatment Act came into force in 2018. Since then, Korean society has made substantial progress toward discussing the end-of-life more openly and fostering a culture of thoughtful reflection on end-of-life care. As the system has become more firmly established, the number of cases in which life-sustaining treatment(LST) has been withdrawn or withheld has steadily increased, and the number of individuals who have registered an Advance Directive on Life-Sustaining Treatment has surpassed three million. Building on these achievements, it is now time to address the limitations revealed in the course of implementing the system and to further advance the framework so that patients’ wishes can be more fully realized in clinical settings. 2026. 03. 20
blog Korea's Green Transition (2): Diagnosing Barriers, Unlocking First-Mover Potential In the previous article, we highlighted that while Korea's climate technology innovation performance ranks among the global top tier, it is concentrated in few companies and technologies, with significant qualitative limitations in innovation outcomes. This is attributed to: ① prioritization of short-term results over long-term necessities, ② lack of institutional incentives to promote long-term innovation, and ③ insufficient financing for innovation 2026. 02. 25
blog Korea's Green Transition (1): High Volume, Low Impact Innovation? As global demands for addressing the climate crisis and building a sustainable economy intensify, the importance of climate technologies is becoming prominent in the transition to a carbon neutral economy where net carbon emissions are 'zero'. Climate technologies are technologies that reduce greenhouse gases and adapt to climate change while generating economic returns, serving as a key element supporting the transition to carbon neutrality. Climate technology innovation provides opportunities to minimize economic contraction and create new growth engines during the transition. 2026. 02. 25
blog The rise in the ‘Resting’ Youth: Is it Because of Their High Job Expectations? Recently, as the number of the ‘Resting’ youth continues to rise, there are growing concerns about the background and implications of this trend. The term ‘Resting’ refers to people who, for no specific reason, are not engaging in job seeking or education/training activities. The increase in the ‘Resting’ youth who are outside the labor market has negative side effects on both them as individuals and the overall economy. Against this backdrop, this blog looks at which types of youth are in the ‘Resting’ state among those facing difficulties in employment and the implications of that[1]. 2026. 02. 13
Blog Misconceptions Regarding Bank of Korea’s RP Purchases and Liquidity Supply Misconceptions Regarding Bank of Korea’s RP Purchases and Liquidity Supply 2026. 01. 16
Blog Why Is the KRW Weakening Despite Abundant U.S. Dollar Liquidity in the Foreign Currency Funding Market? Why Is the KRW Weakening Despite Abundant U.S. Dollar Liquidity in the Foreign Currency Funding Market? 2026. 01. 19
blog Misconceptions and Facts about Current Liquidity and Exchange Rate Conditions Need to assess Claims that Excessive Korean Won Liquidity Has Driven US Dollar/Korean Won Exchange Rate Depreciation Since the end of last year, the US dollar/Korean won exchange rate has risen to the mid-to-high KRW 1,400 range. Against this backdrop, some have continued to argue that excessive growth in domestic liquidity (M2) has led to a depreciation of the Korean won. However, such claims do not consistent with the data or with economic realities. They have been amplified through various channels despite lacking a factual basis, and risk fueling unwarranted expectations of further exchange rate depreciation. For these reasons, it is necessary to set the record straight. 2026. 01. 20
blog AI in Everyday Life: How Workers Use AI Generative AI is no longer just something we hear about in the news. It has already become a part of everyday life—used for brainstorming new ideas, language translation, content creation, and technical analysis in a wide range of areas. Only a few years ago, many people saw it as a technology reserved for experts. Today, it has become a tool that almost anyone can use, at work and at home. So how often—and in what ways—are people actually using AI? And has it actually improved productivity? To find out the answers to these questions, we conducted Korea’s first representative survey on the use of generative A 2026. 01. 06
blog 57,000 AI Professionals—Why Do Firms Still Say They Can’t Find Talent? : Mismatches in Korea’s AI Labor Market Amid the global “AI gold rush,” securing talent has become a key determinant of national competitiveness. An analysis of LinkedIn data covering more than 10 million job histories of approximately 1.1 million Koreans shows that Korea’s pool of AI professionals has more than doubled over the past decade. 2025. 12. 24
Monetary Policy Report Executive Summary for Monetary Policy Report (September 2025) The BOK will maintain its rate cut stance to mitigate downside risks to economic growth and determine the timing and pace of any further Base Rate cuts while closely monitoring changes in domestic and external policy environments, the resulting impact on inflation, and financial stability. 2026. 03. 12

Research Papers

BOK Issue Note What Makes the Current Terms-of-Trade Improvement Different? Real-Economy Spillovers from the Semiconductor Upturn [BOK Issue Note 2026-16] The Korean economy recorded strong GDP growth of 3.8% year on year in the first quarter of this year, supported by the semiconductor upturn. At the sa... 2026.08.04
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BOK Working Paper (in English) BOK Working Paper No.2026-13, Good Housing Booms, Bad Housing Booms: Classifying Local Housing-Market Episodes and Their Macroeconomic Consequences Author : Sangyup Choi(Yonsei University), Junghyuk Lee(Bank of Korea) How can we distinguish good housing booms from bad ones? We develop a high-freq... 2026.08.03
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BOK Issue Note Assessing Recent Labor Market Conditions Using Private Employment Estimates [BOK Issue Note 2026-1] ① Public employment—including senior employment programs and public‑administration employees— have increased steadily over the past several years. ② ... 2026.07.21
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BOK Issue Note The Effects of Overseas Investment and Investment Income on the Exchange Rate [BOK Issue Note 2026-15] 1.    Korea’s overseas investment has increased sharply in recent years, led by portfolio investment. In 2025, direct investment declined to... 2026.07.16
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BOK Issue Note Evaluation of the Economic Effects of People`s Livelihood Recovery Consumption Coupons [BOK Issue Note 2026-13] ① The People’s Livelihood Recovery Consumption Coupons were incorporated into the 2025 supplementary budget to stimulate household consumption an... 2026.07.08
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BOK Issue Note Asset Tokenization in Korea and Global Markets: Current Developments and Future Policy Challenges 1. The asset tokenization market-whereby rights to various financial and real assets such as loans, government bonds, money market funds (MMFs), ... 2026.07.08
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BOK Working Paper Paper (in Korean) BOK Working Paper No.2026-12, Spillover Effects of External Shocks through Cross-Country Transmission Channels: A Large Bayesian Global VAR Approach Author : Sunho Lee(Bank of Korea) This study constructs a Large Bayesian Global Vector Autoregression (LB-GVAR) model covering eight major economi... 2026.07.02
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Korea Economic Outlook Korea Economic Outlook (May 2026) In order to provide a detailed understanding of Korea's economic outlook, a translation of the Economic Outlook is now published quarterly. 2026.06.30
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Annual Reports 2025 Annual Report 1. This is an unofficial translation prepared by the Bank's staff based on the original Korean text released on March 27, 2026. 2. Contents  &... 2026.06.30
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Quarterly/Economic Analysis [Vol.32 No.2] Forcasting Household and Corporate Loan Delinquency Rates in the Banking Sector and Crisis Scenario Analysis Author: Eutteum Park(Bank of Korea), Kyu Ho Kang(Korea Univ.) This study develops a Large Bayesian VAR (LBVAR) model with 22 macro-financial var... 2026.06.30
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Quarterly/Economic Analysis [Vol.32 No.2] Cyclicality of Social Welfare Expenditure Author: Shinyae Noh(Seoul National Univ.), Chul-In Lee(Seoul National Univ.) To assess the income-smoothing capability of social welfare program... 2026.06.30
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Quarterly/Economic Analysis [Vol.32 No.2] Mandatory External Audits, Disclosure Timeliness, and Re-disclosure Behavior of Public-Interest Corporations Author: Sangwha Shin(Chungnam National Univ.) This study exploits the 2020 introduction of mandatory external audits for public-interest corpora... 2026.06.30
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Quarterly/Economic Analysis [Vol.32 No.2] Credit Deterioration and Insurance Policy Lapse Author: Song, Yunah(Korea Insurance Research Institute) This study examines how deteriorating credit conditions affect insurance lapse, using de... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-11, Large Zombies, Small Victims: Evidence on Congestion Effects from Population-Level Data Author : Kyeongtae Lee(Bank of Korea) Most studies on zombie firms focus on listed firms—which account for only a small fraction of the firm populati... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-10, Green Transition, Energy Substitution, and Macroeconomic Dynamics in a DSGE Model for Korea Author : Eunseong Ma(Yonsei University), Joonseok Oh(University of Southampton), Byung Goog Park(Bank of Korea), Kyounghoon Park(Bank of Korea) We st... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-9, Testing Spatial Interactions with Origin-side Heterogeneity Author : Shi Ryoung Chang(Bank of Korea) This paper proposes a Lagrange Multiplier (LM) test for spatial interactions in the presence of origin-side ... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-8, Beyond Homogeneity: Testing Spatial Dependence under Heterogeneous Coefficients in Large Panels Author : Shi Ryoung Chang(Bank of Korea), Robert de Jong(The Ohio State University) The widely used approach to testing spatial dependence formulates... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-7, Effects of New Technology Adoption in Korea: Implications for Growth, Employment, and Inequality Author : Eunseong Ma(Yonsei University), Kisan Choi(Bank of Korea) This paper studies how new technologies interact with labor-market frictions to sh... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-6, ES Activities and Labor Productivity: Evidence from Korean Manufacturing Firms Author : Seongjun Jeong(Bank of Korea), Bok-Keun Yu(Bank of Korea) This study empirically examines how firms’ environmental and social (E and S) acti... 2026.06.30
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BOK Working Paper (in English) BOK Working Paper No.2026-5, Lending to vulnerable households and consumption: Evidence from Korea Author : Jieun Lee(Bank of Korea), Ilhyock Shim(Bank for International Settlements) Using a large quarterly consumer credit panel dataset from Korea c... 2026.06.30
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