ID :
46686
Fri, 02/20/2009 - 23:15
Auther :
Shortlink :
https://www.oananews.org//node/46686
The shortlink copeid
Won hits 3-month low against U.S. dollar
(ATTN: UPDATES with market close, more info throughout)
SEOUL, Feb. 20 (Yonhap) -- The South Korean won tumbled to a three-month low
against the U.S. dollar Friday as renewed concerns over a credit crisis prompted
foreigners to dump local shares, dealers said.
The local currency closed at 1,506 won to the greenback, down 25 won from the
previous session and marking the ninth straight day of decline. It was the first
time since late November for the won to breach the 1,500 mark.
The Korean currency dipped as low as 1,515 won at one point with its value
falling 16.4 percent against the dollar so far this year.
"Once the Korean currency breached the 1,500-won level, investors bet on the
won's further losses, sparking strong dollar demand," said Jeon Seung-ji, a
currency analyst at Samsung Futures Inc. "Rising default risks in eastern
European countries and concerns over squeezed money markets added to market
jitters."
The won's tumble came as foreign investors dumped local shares in pursuit of
safer assets amid a looming credit crisis. The country's key stock index plunged
3.72 percent to 1,065.95. Offshore investors sold a net 359 billion won (US$238.5
million) worth of local stocks on the main bourse.
Reports that Asian countries may increase an $80 billion joint fund created to
help tackle a regional crisis in the wake of the 1997-98 financial meltdown to
$120 billion did little to ease market instability, experts say.
Market jitters have deepened over a chunk of foreign currency-denominated bonds
set to mature in March, with fears that banks will not be able to pay back the
debts amid a dollar shortage.
In recent sessions, the local foreign exchange market has been gripped by fears
that Japanese financial firms may pull their money out of the Seoul market en
masse in March when they close their books. The government and the BOK shrugged
off such rumors, saying that the country could manage its debt burdens given its
foreign reserves worth $201.74 billion.
On Thursday, Finance Minister Yoon Jeung-hyun noted, however, that the government
and the central bank are "closely" watching the market and are prepared to take
action should the market suffer sharp fluctuation.
Experts say the local currency will be under downward pressure for the time
being, given the depth of the economic slump and a subsequent corporate
restructuring drive.
Jeon at Samsung Futures said that dollar demand will be strong in March when
foreigners will begin to repatriate dividends to their home countries.
"A set of downbeat news at home and abroad together sent the won's value sharply
lower. The Korean currency may dip into the 1,550-won level in the short term,"
said Kim Jae-eun, an economist at Hana Daetoo Securities Co.
sooyeon@yna.co.kr
(END)
SEOUL, Feb. 20 (Yonhap) -- The South Korean won tumbled to a three-month low
against the U.S. dollar Friday as renewed concerns over a credit crisis prompted
foreigners to dump local shares, dealers said.
The local currency closed at 1,506 won to the greenback, down 25 won from the
previous session and marking the ninth straight day of decline. It was the first
time since late November for the won to breach the 1,500 mark.
The Korean currency dipped as low as 1,515 won at one point with its value
falling 16.4 percent against the dollar so far this year.
"Once the Korean currency breached the 1,500-won level, investors bet on the
won's further losses, sparking strong dollar demand," said Jeon Seung-ji, a
currency analyst at Samsung Futures Inc. "Rising default risks in eastern
European countries and concerns over squeezed money markets added to market
jitters."
The won's tumble came as foreign investors dumped local shares in pursuit of
safer assets amid a looming credit crisis. The country's key stock index plunged
3.72 percent to 1,065.95. Offshore investors sold a net 359 billion won (US$238.5
million) worth of local stocks on the main bourse.
Reports that Asian countries may increase an $80 billion joint fund created to
help tackle a regional crisis in the wake of the 1997-98 financial meltdown to
$120 billion did little to ease market instability, experts say.
Market jitters have deepened over a chunk of foreign currency-denominated bonds
set to mature in March, with fears that banks will not be able to pay back the
debts amid a dollar shortage.
In recent sessions, the local foreign exchange market has been gripped by fears
that Japanese financial firms may pull their money out of the Seoul market en
masse in March when they close their books. The government and the BOK shrugged
off such rumors, saying that the country could manage its debt burdens given its
foreign reserves worth $201.74 billion.
On Thursday, Finance Minister Yoon Jeung-hyun noted, however, that the government
and the central bank are "closely" watching the market and are prepared to take
action should the market suffer sharp fluctuation.
Experts say the local currency will be under downward pressure for the time
being, given the depth of the economic slump and a subsequent corporate
restructuring drive.
Jeon at Samsung Futures said that dollar demand will be strong in March when
foreigners will begin to repatriate dividends to their home countries.
"A set of downbeat news at home and abroad together sent the won's value sharply
lower. The Korean currency may dip into the 1,550-won level in the short term,"
said Kim Jae-eun, an economist at Hana Daetoo Securities Co.
sooyeon@yna.co.kr
(END)
