South Korean Won Strengthens on U.S. Jobs Report, European Summit Optimism
South Korea’s won advanced, after fluctuating between gains and losses, as U.S. jobs data eased concern that the world’s biggest economy is slowing.
Employment in the U.S. climbed by 120,000 workers in November, after a 100,000 gain the prior month, Labor Department figures showed on Dec. 2. Jobless rate fell to 8.6 percent, the lowest level since March 2009. Italian Prime Minister Mario Monti announced 30 billion euros ($40 billion) of austerity and growth measures yesterday as he seeks to cut debt and prevent a breakup of the euro. European Union leaders hold a summit on Dec. 9 to help resolve the sovereign-debt crisis.
“U.S. job data is good news, and investors will also be paying attention to what happens in Europe this week, the European Central Bank’s rate meeting and the EU summit decisions,” said Jeon Seung Ji, a currency analyst at Samsung Futures Inc.
The won advanced 0.1 percent to 1,129.80 per dollar in Seoul, according to data compiled by Bloomberg. The currency strengthened as much as 0.4 percent earlier, trimming gains on speculation importers sold the local currency for dollars to settle bills, according to Lee Jung Hyun, a foreign-exchange dealer at Seoul-based Industrial Bank of Korea.
The Bank of Korea will keep its benchmark interest rate at 3.25 percent on Dec. 8, according to all ten economists surveyed by Bloomberg. The ECB unexpectedly lowered the benchmark borrowing cost by 25 basis points to 1.25 percent last month. Officials may cut rates again to 1 percent when they meet on Dec. 8, according to 52 of 56 economists surveyed by Bloomberg News.
The yield on South Korea’s 3.5 percent bonds due September 2016 fell one basis point, or 0.01 percentage point, to 3.49 percent, Korea Exchange Inc. prices show.
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