Won hits one-month high on U.S. bond purchase plan

SEOUL, March 19 (Yonhap) -- The South Korean currency rose to a one-month high against the U.S. dollar on Thursday as a plan by the U.S. Federal Reserve to buy government bonds revived appetite for riskier assets, dealers said.

The local currency closed at 1,396 won to the greenback, up 25.5 won, or 1.83
percent from Wednesday and the highest level since Feb. 11.
"The announcement by the U.S. Federal Reserve to purchase treasury bonds drove up
the values of Asian currencies including the won," said Jeon Seung-ji, a currency
analyst at Samsung Futures Inc.
The Fed surprised markets on Wednesday by announcing that it will buy up to
US$300 billion worth of longer-dated government bonds over the next six months,
prompting the dollar to weaken.
The Korean currency climbed as high as 1,377 won to the greenback; its value has
slid 9.78 percent per the dollar so far this year.
Although the country's key stock index closed down 0.7 percent, foreign investors
snapped up a net 50.2 billion won ($36 million) worth of local stocks on the main
bourse.
Analysts said market speculation that Japanese investors may pull their money out
of Seoul markets en masse in March have substantially subdued, but they remained
cautious about the won's direction.
"The won's strength is likely to be limited down the road as the local currency
has sharply gained in recent sessions and global financial markets are not fully
stabilized," Jeon said, adding that the Korean currency may trade in the upper
range of 1,300-won to the dollar.