S. Korean won drops to 6-yr low vs dollar

SEOUL, Oct. 7 (Yonhap) -- South Korea's won fell to an over six-year low on Tuesday on increased concerns that the global credit crunch is deepening as it is exacerbated by slumping stock markets, dealers said.

The won was trading at 1,330.00 against the greenback as of 9:30 a.m., down 61.00
won from the previous session's close.
Dealers said despite the government's repeated assurances that the won's decline
against the dollar is excessive, demand for the greenback remained strong.
"It is hard to find dollar selling bids," said Park Seong-chul, a currency dealer
at Woori Bank. "The government is likely to intervene in the market (to prevent
another sharp drop)."
Earlier in the day, the Deputy Finance Minister reiterated the government's
previous pledge to provide sufficient foreign-exchange liquidity into the local
financial system when necessary.
South Korea's currency market has been suffering from a dollar shortage as banks
and companies are rushing to the safer greenback on concerns over a financial
crisis sparked by the collapse of investment bank Lehman Brothers Holdings Inc.
The Finance Ministry recently announced that it will inject a total of $10
billion into the nation's won-dollar swap market to provide liquidity amid
tightening credit conditions.
The government has spent almost $25 billion since March to support the won, which
has lost around 30 percent so far this year.
sam@yna.co.kr
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