ID :
32652
Thu, 11/27/2008 - 21:12
Auther :
Shortlink :
https://www.oananews.org//node/32652
The shortlink copeid
S. Korea to receive US$4 bln from U.S. in currency swap
(ATTN: UPDATES currency rate in paras 6-7; ADDS more details in last five paras)
SEOUL, Nov. 27 (Yonhap) -- South Korea's central bank said Thursday that it will receive US$4 billion from the U.S. Federal Reserve through a currency swap agreement to provide the greenback to dollar-starved local banks.
The money to be provided on next Tuesday through an auction is part of a currency
swap deal forged last month, in which the Fed will provide up to $30 billion to
the Bank of Korea.
The agreement will be effective until April 30 of next year.
The local currency has lost almost 37 percent against the dollar so far this year
as foreign investors continued to pull money out of the local stock market due to
global financial turmoil and a widening current account shortfall.
"The move will help ease dollar shortages at local banks, and help ease market
jitters as well," a central bank official said.
The won was quoted at 1,477.50 to the dollar as of 9:25 a.m., down 0.6 won from
the previous session's close, after opening at 1,480.00.
The local currency fell on speculation that importers will buy the dollar to pay
month-end bills.
South Korea is also seeking to expand similar deals with China and Japan to help
stabilize the local currency market.
South Korea posted a record current account surplus in October, which may help
ease downward pressure on the already-weak won, the central bank said earlier in
the day.
Experts said that the dollar supply from the Fed and a current account surplus
will help stabilize the currency market, but market jitters still remained due to
declining exports and a continued foreign sell-offs of local stocks.
The South Korean economy, Asia's fourth-largest, has seen its export growth slow
in the past few months in tandem with a global economic slump, while its import
bills increased sharply due to higher oil prices. South Korea is the world's
fourth-largest oil importer.
South Korea's overseas sales, which account for more than half of gross domestic
product, increased 10 percent in October from a year earlier, the weakest pace in
13 months.
Also, foreign investors' selling spree of local stock continued on concerns about
economic slump.
"The currency swap deal with the U.S. is nothing new," said Kim Yong-joon, a
researcher at Korean Center for International Finance. "The move will help
relieve market concerns to some degree... but more steps such as currency swaps
with China and Japan are necessary to curb the won's fall against the dollar."
sam@yna.co.kr
(END)
SEOUL, Nov. 27 (Yonhap) -- South Korea's central bank said Thursday that it will receive US$4 billion from the U.S. Federal Reserve through a currency swap agreement to provide the greenback to dollar-starved local banks.
The money to be provided on next Tuesday through an auction is part of a currency
swap deal forged last month, in which the Fed will provide up to $30 billion to
the Bank of Korea.
The agreement will be effective until April 30 of next year.
The local currency has lost almost 37 percent against the dollar so far this year
as foreign investors continued to pull money out of the local stock market due to
global financial turmoil and a widening current account shortfall.
"The move will help ease dollar shortages at local banks, and help ease market
jitters as well," a central bank official said.
The won was quoted at 1,477.50 to the dollar as of 9:25 a.m., down 0.6 won from
the previous session's close, after opening at 1,480.00.
The local currency fell on speculation that importers will buy the dollar to pay
month-end bills.
South Korea is also seeking to expand similar deals with China and Japan to help
stabilize the local currency market.
South Korea posted a record current account surplus in October, which may help
ease downward pressure on the already-weak won, the central bank said earlier in
the day.
Experts said that the dollar supply from the Fed and a current account surplus
will help stabilize the currency market, but market jitters still remained due to
declining exports and a continued foreign sell-offs of local stocks.
The South Korean economy, Asia's fourth-largest, has seen its export growth slow
in the past few months in tandem with a global economic slump, while its import
bills increased sharply due to higher oil prices. South Korea is the world's
fourth-largest oil importer.
South Korea's overseas sales, which account for more than half of gross domestic
product, increased 10 percent in October from a year earlier, the weakest pace in
13 months.
Also, foreign investors' selling spree of local stock continued on concerns about
economic slump.
"The currency swap deal with the U.S. is nothing new," said Kim Yong-joon, a
researcher at Korean Center for International Finance. "The move will help
relieve market concerns to some degree... but more steps such as currency swaps
with China and Japan are necessary to curb the won's fall against the dollar."
sam@yna.co.kr
(END)
