Korean Won Advances Most in Two Weeks as Risk Appetite Returns

  • Global stocks gain in sign of resilience after Paris attacks
  • Korea export performance better than other countries: BOK

South Korea’s won gained the most in two weeks and stocks rallied as global risk appetite returned after the deadly terrorist attacks in Paris.

The currency climbed from Monday’s one-month low, aided by comments from Bank of Korea Governor Lee Ju Yeol, who said the nation’s export performance was relatively better than other countries. Speaking at a forum in Seoul on Tuesday, he said economic growth for 2016 will be in line with the central bank’s 3.2 percent forecast.

"The impact of the Paris attacks subsided somewhat as shown in the rebound in stocks, and the won will try to recover the losses with support from exporters’ dollar sales,” said Jeon Seung Ji, a currency analyst at Samsung Futures Inc. in Seoul. "Governor Lee’s words were in line with previous comments and the won is prone to rise."

The won advanced 0.3 percent to close at 1,170.30 a dollar in Seoul, the biggest gain since Nov. 3, data compiled by Bloomberg show. The currency appreciated as much as 0.6 percent earlier to 1,167.44. It fell 0.9 percent on Monday and reached 1,174.72.

The Kospi index of shares climbed 1.1 percent as stocks rebounded in Europe and the U.S. The gauge fell 1.5 percent on Monday in the steepest slide since late September.

Structural reforms such as easing of regulations and boosting productivity are essential for South Korea’s growth, Governor Lee said. The BOK held its benchmark interest rate at a record low of 1.5 percent for a fifth month on Nov. 12 and projects the economy will expand 2.7 percent in 2015.

Government bonds fell. The three-year yield rose one basis point to 1.76 percent and the 10-year yield increased two basis points to 2.31 percent, Korea Exchange prices show.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE