It has been reported that household disposable income in the first quarter of this year increased significantly, partly due to a decrease in real estate investments and the impact of year-end bonuses from last year. The government significantly expanded fiscal expenditures from the beginning of the year, leading to a record high net fund-raising amount exceeding 50 trillion won.
According to the fund circulation data released by the Bank of Korea on the 4th, the net fund operating amount for households and non-profit organizations in the first quarter of this year amounted to 77 trillion 600 billion won. This was an increase of 47 trillion 800 billion won from the previous quarter, but a decrease of 8 trillion won compared to the first quarter of last year, which was 85 trillion 600 billion won. Net fund operating amount is the amount obtained by subtracting the fund-raising amount from the fund operating amount for each economic entity during the specified period.
Jung Jin-woo, head of the BOK’s fund circulation team, explained that the increase in net fund operating amount from the previous quarter was due to the surplus funds resulting from a decrease in household physical investments such as apartment sales and acquisition of buildings. He also mentioned that the seasonal factor of a large inflow of year-end bonuses in the first quarter should be considered. The enlargement of financial product sizes including overseas stocks led to an expansion in fund operation. In terms of sectors, household’s domestic equity securities and investment funds switched from a net fund-raising of 13 trillion 100 billion won in the fourth quarter of last year to a net fund operation of 2 trillion 900 billion won in the first quarter of this year. Deposits and other financial institution accounts increased from 18 trillion 400 billion won to 58 trillion 600 billion won.
[Han Sang-heon, Reporter]