Parked money in search of new investments hits new high: data

Bank of Korea building in Jung-gu, Seoul (Yonhap)

The amount of parked money that can be withdrawn any time has surged to an all-time high, data showed Sunday.

According to the Bank of Korea, the amount of demand deposit increased by 3.3 trillion won ($2.8 billion) to some 388.7 trillion won as of July. It is the largest amount since the central bank started to collect related data.

Market experts suggested that extra cash ready for new investments has few places to go because of the government’s intensifying regulatory moves on the property market.

“Due to real estate regulations and surging housing prices, it is hard for retail investors to make money by purchasing and selling real estate like they used to. So they seem to be waiting for other promising investments,” a bank official said.

Also, retail investors appear to be leaving their cash in the bank in anticipation of an interest rate hike.

The BOK is likely to further raise the benchmark interest rate from the current 0.75 percent, according to experts.

The amount of cash parked in accounts has been on the rise for 34 months. The figure surpassed the 300 trillion won mark in July last year, when the market was hit by the COVID-19 pandemic.

By Byun Hye-jin(hyejin2@heraldcorp.com)