earticle

영어

As a result of driving the liberalization policy of capital movement, the Korea's financial market has been perfectly opened to foreigners under the present circumstances. Since the 1998, the Korea's Current Accounts has consistently maintained surplus, and high level of capital mobility has resulted in the excessive change in reserve assets. The floating exchange rate system and the liberalization of capital movement has exerted lots of effects on the effectiveness of Korean monetary policy, which was showed to produce an effective influence on economic equilibrium. However, several monetary policies including sterilization policy was restrictedly affected by free movement of capital in reality. This paper has concentrated on the degree of offset effect on sterilization policy by free capital movements for 2000~2006. The result of empirical analysis shows that sterilization coefficient and offset coefficient are gradually diminished according to improvement in capital movement.