South Korea’s won posted its first weekly drop in a month on speculation global funds repatriated stock dividends and as improving U.S. economic data bolstered demand for dollars.
Companies including Samsung Electronics Co. and SK Telecom Co. paid dividends this week, according to data compiled by Bloomberg. The Bloomberg Dollar Spot Index, which tracks the U.S. currency against 10 major counterparts, was poised for its biggest five-day advance since March 21 after retail sales and factory output beat economists’ estimates.
The won declined 0.2 percent from April 11 to 1,037.58 per dollar at the close in Seoul, according to data compiled by Bloomberg. It is Asia’s best-performing currency over the past six months and appreciated 0.1 percent today. It reached 1,031.55 on April 10, the strongest since 2008.
“The dollar rebounded as U.S. data turned positive and as foreigners converting dividend proceeds supported demand for the greenback, said Son Eung Jeong, a Seoul-based currency analyst at Woori Futures Co. ‘‘There seems to be many market investors thinking 1,030 will be the peak for the won for some time.’’
One-month implied volatility, a gauge of expected moves in the exchange rate used to price options, dropped 45 basis points from April 11 and 16 basis points today to 6.70 percent.
The Bloomberg Dollar Index climbed 0.4 percent for the week, after dropping 1 percent in the five days through April 11, the biggest loss since September.
Overseas funds bought $417 million more South Korean shares than they sold during the five days, the latest exchange data show, while the Kospi stock index climbed for a fifth week.
Officials met in Geneva yesterday to discuss the crisis in Ukraine stemming from Russia’s annexation of the Crimean peninsula. Pro-Russian separatists have occupied some government buildings in eastern Ukraine, while the U.S. and its European allies have threatened further sanctions against President Vladimir Putin.
Four-way talks between the U.S., the European Union, Ukraine and Russia ended with an accord aimed at taking the first steps toward de-escalating the conflict.
South Korean government bonds fell for the week, with the yield on the 3.125 percent notes due March 2019 increasing four basis points, or 0.04 percentage point, to 3.18 percent, Korea Exchange data show. The yield rose two basis points today.