South Korea’s won fell by the most in a week as cooling growth in the world’s biggest economies stoked concern the pace of recovery is losing steam.
Europe’s services and manufacturing slowed for a second month in June, according to a report from London-based Markit Economics yesterday. U.S. service industries data out today will show non-manufacturing businesses expanded at a slower pace in June, a Bloomberg survey shows. The euro fell for a second day after European Central Bank President Jean-Claude Trichet supported deficit-cutting measures by governments in the region.
“We’re seeing a normal post-crisis struggle in the won,” said Philip Wee, a senior currency economist from DBS Bank Ltd. in Singapore. “The key thing is to see how we ride through this weakness.”
The won slipped 0.6 percent to 1,230.75 per dollar as of 10:08 a.m. in Seoul, after the currency gained 0.5 percent yesterday, according to data compiled by Bloomberg.
The Kospi share index fell to a three-week low after overseas sold more local stocks than they bought for a fifth day, capping this year’s total purchases at $4.6 billion.
“Markets will be taking a cue from stocks, as they are a leading indicator of growth,” Wee said.
European equities dropped for a fifth day, the longest streak in a year, after a composite index based on a survey of euro-area purchasing managers in services and manufacturing industries declined to 56 from 56.4 in May, yesterday’s report said. U.S. stocks were closed for the Independence Day holiday. Trading resumes today.
South Korea’s three-year bonds were little changed. The yield on the 3.75 percent note maturing in June 2013 was 3.84 percent, according to Korea Stock Exchange. A basis point is 0.01 percentage point.