As U.S. lawmakers continue to butt heads over issues that led the government to shut down this week, local officials are still bracing for the possible negative impact on the Korean economy.
The Ministry of Strategy and Finance has been keeping close tabs on global developments as the impasse in Washington could intensify market volatility. But so far the effect on the domestic economy has been limited.
Korean stocks ended nearly flat on Wednesday as investors shrugged off concerns relating to the U.S. shutdown. But analysts warn that the uncertainties in the U.S. may weigh down the inflow of foreign currency into local markets if the stalemate becomes drawn out. This could impact private sector spending and eventually take a bite out of Korea's export-driven economy.
Although Seoul expects to see the U.S. resolve the issue shortly, the ministry said it is ready to spring into action with measures if the fallout becomes more pronounced.