S. Korea to loosen FX liquidity guidelines to boost funding

SEOUL, March 25 (Yonhap) -- South Korea will ease foreign exchange liquidity rules temporarily to prod local financial firms to provide more dollars in the currency market currently roiled by the market turbulence, the country's chief economic policymaker said Wednesday.

Local financial institutions have been required to hold an adequate amount of foreign currency assets on hand to get over short-term liquidity disruptions.

Currently, the foreign exchange liquidity coverage ratio (LCR) for banks is set at 80 percent.

The FX LCR is measured as high-quality liquid foreign assets to projected net cash outflows over 30 days.
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