S. Korean won hits near 1-year high to U.S. dollar

SEOUL, Sept. 21 (Yonhap) -- The South Korean currency rose to a near one-year
high against the U.S. dollar on Monday as foreigners continued to buy Seoul
stocks on economic recovery hopes, dealers said.
The local currency closed at 1,204.4 won to the greenback, up 3.4 won or 0.28
percent from the previous session, the strongest level since Sept. 29, 2008. The
Korean unit climbed as high as 1,202.2 won to the dollar at one point.
"Due to caution against intervention, the Korean currency traded in a tight
range. But stock buying by foreign investors put upward pressure on the won in
late trading," said Byeon Ji-young, a currency analyst at Woori Futures Co.
Foreign investors snapped up Seoul stocks for the 12th straight session,
encouraged by South Korea's inclusion in the Financial Times Stock Exchange
(FTSE) advanced market category, which was effective as of Monday. They bought a
net 184.2 billion won (US$153 million) worth of local stocks on the main bourse.
Despite foreign buying, the benchmark Korea Composite Stock Price Index (KOSPI)
inched down 0.25 percent to 1,695.5, weighed down by heavy institutional
sell-offs.
Analysts said the Korean currency would likely continue to gain strength against
the greenback, but its ascent would be limited due to caution about possible
government intervention.
"Throughout this week, the local currency is likely to trade in a 1,200-won range
as market players will likely be alert for any possible intervention," said Jeon
Seung-ji, a currency analyst at Samsung Futures Inc.
Byeon at Woori Futures also said the pace of the won's gain would be eased this
week as the global weakness of the dollar may be trimmed due to uncertainties
surrounding big events like a rate-setting meeting by the U.S. Federal Reserve
and the G-20 summit.
"Offshore investors' buying spree is likely to abate as hefty amounts of stock
buying have already flowed into the Seoul market ahead of Korea's FTSE
promotion," Byeon added.
sooyeon@yna.co.kr
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