Virus Will Set Back South Korea’s Recovery This Year: S&P Global Ratings

The video discusses the impact of the coronavirus outbreak on South Korea's economy, predicting a setback in recovery and a drop in growth below 2%. The government is considering extra spending, and the Bank of Korea is expected to implement rate cuts, potentially leading to quantitative easing. The effectiveness of monetary and fiscal policies is debated, with a focus on cushioning the economic blow rather than reversing it. Targeted measures to ease cash flow pressures are suggested as more effective in the short term.

What is the expected impact of the coronavirus outbreak on South Korea's economic growth for the year?

• Growth will increase by 0.5 percentage points.

• Growth will decrease by 0.5 percentage points.

• Growth will exceed 3%.

• Growth will remain stable at 2%.

What measures is the South Korean government considering to address the economic impact of the coronavirus?

• Raising interest rates

• Reducing public spending

• Implementing rate cuts and fiscal stimulus

• Increasing taxes

What is the expected action of the Bank of Korea in response to the economic challenges posed by the coronavirus?

• Increase interest rates

• Implement two rate cuts

• Maintain current interest rates

• Introduce new taxes

Why might macroeconomic policies be less effective in addressing the current economic shock?

• They cannot address supply chain disruptions.

• They are designed for long-term growth.

• They are too expensive to implement.

• They focus only on inflation control.

What type of measures might policymakers focus on to cushion the economic impact of the coronavirus?

• Raising interest rates

• Reducing government spending

• Targeted measures to ease cash flow pressures

• Increasing corporate taxes