In its most recent evaluation, MSCI Inc has decided to keep South Korea classified within its emerging market index and has not commenced a formal review process that could potentially lead to an upgrade of the country's $5 trillion stock market to developed market status.

The New York-based index provider stated in an announcement on Tuesday that South Korea will continue to be categorized as an emerging market following its annual market classification review.

The announcement acknowledged that South Korean authorities have declared several measures aimed at improving long-standing market accessibility issues, but noted that key structural bottlenecks have not yet been fully resolved.

MSCI stated in the announcement: "The onshore liquidity of the Korean won during extended trading hours remains significantly insufficient to support the tight execution standards comparable to developed markets." This limits the flexibility for foreign exchange operations by index replicators and other institutions. This widely anticipated decision follows MSCI's indication last week that market accessibility issues persist, dampening expectations that the world's best-performing major stock market this year might begin the process of joining the developed market ranks—a status that offers global investors greater accessibility, liquidity, and operational efficiency.