S. Korean won drops to 17-year low as foreign investors sell stocks
The South Korean won fell to its lowest point since 2009 against the U.S. dollar on Friday, as foreign investors kept selling local stocks amid declining hopes for a diplomatic resolution to the Middle East conflict, Qazinform News Agency reports, citing Yonhap.
The won was quoted at 1,539.1 per dollar at 3:30 p.m., down 9.4 from the previous session, marking its weakest level since March 9, 2009.
The won started at 1,529 per dollar, up 0.7 from the previous close, but then declined as foreign investors sold local shares.
During Friday’s trading, the won declined to 1,549.1 per dollar, its lowest intraday level since March 10, 2009.
The won’s weakness persists despite authorities’ promises to curb excessive volatility in the foreign exchange market.
On Friday, foreign investors sold a net 3.5 trillion won (US$2.3 billion) of local stocks.
For the 20th consecutive trading session, foreign investors remained net sellers of local stocks.
The Korea Composite Stock Price Index fell 5.54%, closing at 8,160.59.
Moon Jeong-hee, an economist at KB Kookmin Bank, explained that the won’s decline was driven by strong demand for U.S. dollars as foreign investors continued to sell their local stock holdings.
Earlier, Qazinform News Agency reported that South Korea’s exports jumped 53% year-over-year to a record 87.8 billion US dollars in May, marking the third straight month above the 80 billion US dollars mark.