Won Advances Most in Two Weeks as Exporters Seen Selling DollarsJiyeun Lee
The won gained the most in more than two weeks on bets South Korean exporters are repatriating overseas earnings as the month-end approaches.
Shipments from Asia’s fourth-biggest economy probably increased 5.5 percent in April from a year earlier, after rising 5.1 percent in March, according to a Bloomberg survey of economists before official data due May 1. Foreign investors bought $3.1 billion more of the nation’s equities than they sold this month, exchange data show. South Korea’s financial markets are closed on May 1, 5 and 6 for holidays.
“A lot of exporters were seen selling dollars as it’s near the end of the month and we also have public holidays coming soon,” said Han Sung Min, a Seoul-based currency trader for Busan Bank.
The won strengthened 0.6 percent to 1,035.25 per dollar at the close in Seoul, the biggest gain since April 9, data compiled by Bloomberg show. The currency appreciated 2.8 percent this month, the most among 11 Asian currencies. One-month implied volatility, a gauge of expected moves in the exchange rate used to price options, increased two basis points, or 0.02 percentage point, to 6.54 percent.
South Korea’s prime minister resigned yesterday over the government’s failure to handle the sinking of the Sewol ferry, the nation’s worst maritime disaster in four decades. The official death toll of 188 will probably rise to 302, as no survivors have been found since 174 of the 476 passengers and crew were rescued on the day of the sinking.
Bank of Korea officials are closely looking at how the ferry sinking affects consumption and economic growth, central bank Governor Lee Ju Yeol told reporters in Seoul today.
The yield on the nation’s 3.125 percent government bonds due March 2019 was little changed at 3.17 percent, according to Korea Exchange data.