ID :
23488
Thu, 10/09/2008 - 13:50
Auther :
Shortlink :
http://m.oananews.org//node/23488
The shortlink copeid
Currency rebounds from 10-year low on intervention
(ATTN: UPDATES currency rate in 2nd para; ADDS more quotes in paras 9-10)
SEOUL, Oct. 9 (Yonhap) -- The South Korean won bounced back from a decade low against the U.S. dollar Thursday as foreign exchange authorities intervened and the local stock market recouped earlier losses, dealers said.
The local currency closed at 1,379.50, up 15.5 won from Wednesday's close. The
won fell to as low as 1,485.55 at one point during the morning session, the
weakest since March 1998. On Wednesday, the won lost almost 5 percent.
"Foreign exchange authorities intervened to cut further losses by the won," said
a currency dealer at Korea Exchange Bank who asked not to be named.
Dealers said a rebound in the local stock market also eased demand for the
greenback.
The KOSPI, the country's key stock index, finished up 8.2 points at 1,294.89. The
index fell nearly 1 percent in the morning session, but gained ground after the
central bank unexpectedly cut its key interest rate by a quarter percentage point
to 5 percent.
The Bank of Korea (BOK) joined in a round of rate cuts worldwide aimed at easing
turmoil in global markets.
The decision came after the BOK's counterparts in the United States, Europe and
China cut their rates by between 25 and 50 basis points on Wednesday in an
attempt to grapple with the worst financial crisis in decades.
The won has slumped as foreign investors have continued to withdraw from the
local stock market and the country's trade balance has worsened. The currency has
lost about 33 percent against the dollar this year.
Kim Jong-chang, governor of the Financial Supervisory Service, said the market is
"overly" concerned about the currency movement. "The won's recent drop is
'overshooting' to some degree. Liquidity conditions are not bad at this point,"
Kim said in a meeting with reporters.
It will take some time to muddle through the financial rout, but there is only a
slim chance that local banks and companies will face a liquidity problem, he
said.
South Korea's key index fell to a 26-month low on Wednesday, and has fallen more
than 30 percent this year. The country is expected to 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.
A global credit crunch has created a dollar liquidity shortage for local banks
and importers, further fanning 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 said on the same day that
global financial woes may cause the country to fall short of its economic growth
target of 4.7 percent.
sam@yna.co.k
SEOUL, Oct. 9 (Yonhap) -- The South Korean won bounced back from a decade low against the U.S. dollar Thursday as foreign exchange authorities intervened and the local stock market recouped earlier losses, dealers said.
The local currency closed at 1,379.50, up 15.5 won from Wednesday's close. The
won fell to as low as 1,485.55 at one point during the morning session, the
weakest since March 1998. On Wednesday, the won lost almost 5 percent.
"Foreign exchange authorities intervened to cut further losses by the won," said
a currency dealer at Korea Exchange Bank who asked not to be named.
Dealers said a rebound in the local stock market also eased demand for the
greenback.
The KOSPI, the country's key stock index, finished up 8.2 points at 1,294.89. The
index fell nearly 1 percent in the morning session, but gained ground after the
central bank unexpectedly cut its key interest rate by a quarter percentage point
to 5 percent.
The Bank of Korea (BOK) joined in a round of rate cuts worldwide aimed at easing
turmoil in global markets.
The decision came after the BOK's counterparts in the United States, Europe and
China cut their rates by between 25 and 50 basis points on Wednesday in an
attempt to grapple with the worst financial crisis in decades.
The won has slumped as foreign investors have continued to withdraw from the
local stock market and the country's trade balance has worsened. The currency has
lost about 33 percent against the dollar this year.
Kim Jong-chang, governor of the Financial Supervisory Service, said the market is
"overly" concerned about the currency movement. "The won's recent drop is
'overshooting' to some degree. Liquidity conditions are not bad at this point,"
Kim said in a meeting with reporters.
It will take some time to muddle through the financial rout, but there is only a
slim chance that local banks and companies will face a liquidity problem, he
said.
South Korea's key index fell to a 26-month low on Wednesday, and has fallen more
than 30 percent this year. The country is expected to 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.
A global credit crunch has created a dollar liquidity shortage for local banks
and importers, further fanning 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 said on the same day that
global financial woes may cause the country to fall short of its economic growth
target of 4.7 percent.
sam@yna.co.k
