South Korean Retail Traders ‘Livid’ Over Won Slide Blame Game

Forex

Economic

Summary:

South Korean retail investors' $31 billion record purchases of US stocks this year have turned them into scapegoats for the country's weakening currency. They are furious.

Asia's worst performer this quarter, the Korean won came close to hitting a 16-year-low in recent weeks. Officials, including the Bank of Korea governor, have blamed the retail traders' appetite for overseas equities for hurting the currency.

The accusation "stunned" many of the country's estimated 14 million mom-and-pop investors, said office worker Park Eun-hye, who has been buying US stocks for years. People were "absolutely livid" that they were being held responsible for the won's slide, she added.

Small investors are "easy targets" for blame, Park said, when in fact "excessive liquidity and other broader factors could play a much bigger role."

Priced out of Seoul's red-hot real estate and fed up of lackluster returns on the Kospi — which had languished for a decade before 2025's unusual bull run — South Korea's army of retail investors have turned to high-risk options, from crypto to leveraged overseas exchange-traded funds, in a bid to create wealth. But their industriousness is now frustrating Seoul's top financial policymakers.

Korean retail investors have snapped up an unprecedented net $31 billion worth of US equities this year, according to Korea Securities Depository data. That's nearly triple the amount they bought in 2024 and more than 12 times the level in 2019.

One prominent local paper ran a headline decrying a possible "foreign exchange crisis" — which the government has roundly denied. Official data showed equities outflows totaled about $18 billion in October, the bulk of which was linked to retail investors, versus roughly $3 billion coming in.

"If more money flows out of the country than comes in, it can drive the won weaker or limit its strength," said Stephen Lee, economist at Meritz Securities, adding that Koreans' overseas equity investments were "a natural outcome" of the expected returns.

The "trend" of young South Koreans piling into overseas stocks is concerning, BOK Governor Rhee Chang Yong said late last month, and authorities are tightening rules on leveraged buying of ETFs listed offshore.

But Koreans are not buying "foreign stocks just because it is cool," ex-trader and portfolio manager turned YouTube financial influencer Syuka said on his widely-watched channel. Such purchases resulted from a decade of stagnation in the local market, he said.

The outflows have persisted even as the Kospi Index has risen more than 70% to become one of the world's best performers this year, thanks in part to optimism about corporate reforms and President Lee Jae Myung's repeated pledge to boost market value.

Targeted government efforts are key to fixing the won's weakness, said Jung Eui-jung, head of the Korea Stockholders Alliance, adding that officials should "self-reflect" and scrutinize their policies, not "shift blame" to retail investors.

Even some officials have taken a softer line on the issue, with Financial Supervisory Service Governor Lee Chan-jin saying he could "empathize" with Korean traders' desperate hunt for returns.

"Blaming the exchange rate rise solely on retail investors investing overseas is overinterpretation," said 27-year-old retail investor Won Jung Yeon who runs a financial tips YouTube channel.

He started trading stocks after realizing he'd never get rich off a salary alone and said all "retail investors make investment decisions solely for profit."

If the incentives were right, more investors like Park Minyeol, a Seoul-based public official in his 30s who has invested heavily in overseas stocks, said they could be lured home. He's "considering putting about 10–20% of my money into domestic equities," due to his interest in Korean robotics stocks.

Source: Bloomberg Europe

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Justin

Forex

Economic

Japan's economy shrank more sharply in the third quarter than previously estimated, according to a revised release from the Cabinet Office of Japan on Monday.

The revised annualised contraction came in at 2.3%, compared with an earlier reading of a 1.8% decline and a median forecast for a 2.0% fall.

On a quarter-on-quarter basis, gross domestic product fell 0.6%, steeper than the initial 0.4% contraction and exceeding a median forecast of a 0.5% decline.

Private consumption -- a key engine of the economy -- managed a modest rebound, rising 0.2% compared with a 0.1% uptick in the preliminary reading. Meanwhile, capital expenditure was revised downward sharply, showing a 0.2% drop instead of the 1.0% rise initially reported.

External demand remained a drain on growth, with net exports subtracting 0.2 percentage points, while domestic demand contributed a 0.4-point drag, worse than earlier estimates.

The deeper contraction reflects lingering headwinds from weak global demand, trade frictions, and subdued private investment. The weaker reading could complicate near-term economic prospects for Japan, even as policymakers weigh fiscal and monetary measures to support growth.

The data could also temper near-term expectations of a Bank of Japan rate hike, as focus remains on new Prime Minister Sanae Takaichi's plans for more fiscal spending.

Source: Investing

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Samantha Luan

Stocks

Economic

U.S. President Donald Trump said on Sunday that he would have a say whether a proposed merger between Netflix and Warner Brothers should go forward, telling reporters the market share of a combined entity could raise concerns.

"I'll be involved in that decision," Trump told reporters as he arrived at the Kennedy Center for its annual awards show.

Netflix on Friday agreed to buy Warner Bros Discovery's TV, film studios and streaming division for $72 billion, a deal that would hand control of one of Hollywood's most prized assets to the streaming pioneer.

Trump did not say whether he favored approval for the deal, but he pointed to a potential concentration of market power in the entertainment industry.

"That's going to be for some economists to tell…. But it is a big market share. There's no question it could be a problem," Trump said.

Source: Investing

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Winkelmann

Political

Economic

Britain's jobs market remained weak last month in the run-up to finance minister Rachel Reeves' budget on November 26 as employers worried about possible new tax increases, an industry report showed on Monday.

Permanent job placements shrank at the slowest rate since July 2024 but the reading was barely up from October, according to the survey by accountants KPMG and the Recruitment and Employment Confederation, a trade body.

The survey's gauge of temporary hiring slipped below the 50.0 no-change level.

"A complex business environment and uncertainty around the budget kept hiring on ice last month, as business leaders weighed potential impacts," said Lisa Fernihough, head of advisory at KPMG.

"There will be relief at the absence of major tax hikes. However that alone is unlikely to be enough to see a marked change in how firms are planning."

Some other recent business surveys have similarly shown downturns in hiring before Reeves' annual budget last month.

It included plans for 26 billion pounds ($35 billion) in tax rises but spared employers from the brunt of the increases.

A Bank of England survey published last week - which was also conducted before Reeves' budget - showed firms expected to reduce staff numbers.

Official data last month showed Britain's jobless rate hit 5.0% in the third quarter, which some economists linked to tax hikes that were announced by Reeves last year and took effect in April. Wage growth cooled slightly.

The REC/KPMG survey showed that a fall in vacancies in November was the least severe in five months. The availability of workers rose at the second-fastest pace since November 2020.

A measure of growth in starting pay for people taken on for permanent roles increased at the fastest pace in five months as employers competed for candidates with in-demand skills.

The survey of around 400 recruitment and employment consultancies was conducted between November 12 and 24.

($1 = 0.7493 pounds)

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Daniel Carter

Political

Russia-Ukraine Conflict

Trump's tone on Ukraine contrasted with comments in recent days about President Vladimir Putin's reaction to the proposal.

The US said Friday its negotiators had agreed with Kyiv on a "framework of security arrangements" and discussed what deterrence capabilities were needed as part of a deal to end the war with Russia. However, there was little indication of a major breakthrough.

"We've been speaking to President Putin and we've been speaking to Ukrainian leaders, including Zelenskiy," Trump told reporters in Washington on Sunday. "I have to say that I'm a little bit disappointed that President Zelenskiy hasn't yet read the proposal — that was as of a few hours ago."

"His people love it, but he hasn't," Trump said of Zelenskiy, claiming that "Russia's fine with it."

Zelenskiy said Saturday he spoke with US envoy Steve Witkoff and President Donald Trump's son-in-law Jared Kushner about the latest talks. The Ukrainian leader said in a post on social media that they "agreed on the next steps and formats for talks with the United States."

Leaders of France, Germany and the UK plan to meet Zelenskiy in London on Monday to discuss US efforts to reach a peace deal — after Russia carried out another round of massive attacks on Ukraine.

Witkoff and Kushner met Putin in Moscow last week. Trump said Wednesday that the Putin meeting was "very good" and that his advisers had a strong impression "that he'd like to make a deal," though the Kremlin has yet to fully endorse any of the proposals.

Putin said Thursday that difficult work remained and that the US plan included concessions Russia couldn't agree to.

Source: Bloomberg Europe

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Daniel Carter

Political

US, Israeli and Qatari officials are meeting Sunday in an effort to rebuild relations after Israel's airstrike in September on Qatar, a US ally, Axios reported.

Steve Witkoff, President Donald Trump's envoy to the Middle East, is meeting David Barnea, the head of Israel's Mossad intelligence agency, and a senior Qatari official, Axios reported.

Qatari Prime Minister Sheikh Mohammed Bin Abdulrahman Al Thani said on Saturday the ceasefire negotiations between Israel and Hamas are going through "a critical moment."

There's "a lot of uncertainty" over Middle East stability as deadly Israeli strikes continue to shake fragile ceasefires in Gaza and Lebanon and Iran's standoff with the US remains unaddressed, he also told the Doha Forum on Sunday.

Israel's strike on Doha, Qatar's capital, was aimed at leaders of Hamas, the Palestinian terror group that attacked Israel in October 2023 — triggering the war in Gaza. The Doha attack prompted rare criticism of Israeli leaders by the White House and unnerved Gulf neighbors of Qatar, which hosts the largest US military base in the Middle East.

Source: Bloomberg Europe

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Gerik

Economic

Resilience Amid Trade Frictions and Global Uncertainty

The International Monetary Fund (IMF) has issued a cautiously optimistic assessment of Canada’s economic performance, highlighting its resilience in the face of heightened trade tensions with the United States. Although tariffs created notable uncertainty and disrupted sectors such as manufacturing and wholesale trade, the broader economy has held steady, defying expectations of a sharper slowdown.

According to the IMF, temporary exemptions granted under the Canada–U.S.–Mexico Agreement (CUSMA) helped cushion the initial impact of U.S. tariffs. Still, Canada faced mounting pressure from lower commodity prices, weaker global demand, decelerating immigration, and persistent trade-related uncertainty. Despite these challenges, the IMF praised Canada’s response, particularly the federal government's fiscal pivot toward public investment, while cautioning that debt-to-GDP management should remain a long-term priority.

Labour Market Outperforms Expectations

Canada’s labor market delivered an upside surprise in November by adding 54,000 jobs, pushing the national unemployment rate down to 6.5% from 6.9% in October. This marked the second consecutive month of improvement since unemployment peaked at 7.1% in September the highest level since May 2016 following the COVID-19 pandemic.

Job growth was particularly strong in health care and social assistance (+46,000), followed by accommodation and food services (+14,000), and the natural resources sector (+11,000). Meanwhile, industries more sensitive to trade dynamics, such as manufacturing and retail/wholesale, recorded job losses signaling that U.S. tariff effects remain uneven across sectors.

An important trend was the surge in part-time employment, which outpaced full-time job creation over the past three months. Since September, part-time positions have grown by 103,000 while full-time jobs increased by 78,000. Private-sector hiring accounted for nearly all job gains in November, with 52,000 new positions added, while the public sector and self-employment remained flat.

Youth Employment and Wage Growth Offer Encouraging Signals

Youth unemployment also declined, dropping to 12.8% in November from 14.7% in September, indicating better access to entry-level or flexible employment opportunities. Additionally, average hourly wages rose 3.6% year-on-year, slightly up from 3.5% in October. This suggests that while inflationary pressures remain moderate, wage growth is continuing in line with economic recovery and labor market tightening.

The rate of job separation measuring individuals employed in October who became unemployed in November stood at 0.7%, consistent with figures from the previous year and signaling no spike in layoffs.

Policy Outlook: BoC Likely to Hold Rates Steady

Contrary to earlier predictions that Canada might experience net job losses, the stronger-than-expected November data has prompted economists to revise expectations for the Bank of Canada (BoC). The central bank, which currently holds its policy rate at 2.25%, is now widely expected to maintain this level in its December 10 meeting.

The IMF’s endorsement of Canada’s macro-fiscal orientation supports this expectation. The government's recent budget strategy emphasizes public investment to drive medium-term growth, suggesting coordinated policy alignment between fiscal and monetary authorities. Still, with ongoing risks from external trade disputes and a volatile global economic backdrop, the BoC is expected to remain cautious in signaling future moves.

Strong Fundamentals, Yet Risks Linger

Canada’s economy has demonstrated remarkable resilience amid adverse trade developments and global headwinds. The combination of job market strength, moderate inflation, and targeted fiscal spending has helped stabilize growth without triggering overheating or rapid policy tightening.

However, challenges persist. Sector-specific job losses and the disproportionate reliance on part-time employment suggest that underlying vulnerabilities remain, particularly in industries exposed to international trade. Furthermore, the long-term fiscal burden, as flagged by the IMF, could limit future maneuverability if external shocks persist or deepen.

Nonetheless, Canada’s current trajectory reflects a balance between adaptation and prudence anchoring its economy in stability while preparing for an uncertain global future.

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