Currency hits 10-year low, sliding for 5th day

SEOUL, Oct. 9 (Yonhap) -- The South Korean won hit an over 10-year low against the U.S. dollar Thursday morning on concerns that a deepening global credit crunch will pose further difficulties for local companies and banks in securing dollars, dealers said.

The local currency was trading at 1480.00 as of 9:27 a.m., down 85 won from
Wednesday's close and the weakest since March 1998. On Monday, the won lost
almost 5 percent.
The won, which has lost about 33 percent this year, has slumped as foreign
investors have continued to withdraw from the local stock market and the
country's trade balance worsened.
The KOSPI, the country's key stock index, fell to a 26-month low on Wednesday.
The index was down 0.56 percent at 1,279.45 as of 9:27 a.m. in today's trading.
South Korea may post a $6 billion trade deficit in 2008, Knowledge Economy
Minister Lee Youn-ho said Monday. The shortfall amounted to $14.2 billion for the
first nine months of this year.
Also, the global credit crunch has forced local banks and importers to face a
dollar liquidity shortage, further fanning strong demand for the greenback.
Experts said that increased concerns over an economic slowdown will continue to
prod market participants to scramble towards dollar buying.
On Tuesday, Finance Minister Kang Man-soo said that global financial turmoil is
beginning to hurt the economy. The finance ministry also said on the same day
that global financial woes may cause the country's economic growth for the year
to fall short of its yearly target of 4.7 percent.
The Bank of Korea, the country's central bank, is to review its rate policy later
in the day. Last month, it kept its key rate at an eight-year high of 5.25
percent.
sam@yna.co.kr
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