South Korean Won Rises as Foreigners Buy Stocks, Dollar DeclinesMoonyoung Tae
South Korea’s won rose as global funds increased their holdings of local equities for a seventh day.
Overseas investors added more Kospi Index shares than they sold Monday, exchange data show. The benchmark gauge of equities was little changed after surging 2.6 percent last week, the most since the five days through May 18. The won also strengthened after the dollar suffered its steepest weekly slide since October 2011 on speculation the Federal Reserve isn’t in a hurry to raise U.S. interest rates.
The won rose 0.7 percent to 1,114.59 a dollar as of the 3 p.m. close in Seoul Monday, according to data compiled by Bloomberg. The Bloomberg Dollar Spot Index, which tracks the greenback against a basket of 10 global peers, fell 0.1 percent after declining 2.2 percent last week.
“Short-term funds can increase buying of South Korean shares as the index is headed upwards,” said Kim Moon Il, a Seoul-based analyst at Eugene Investment & Securities Co. “If the won strengthens, investors can expect to benefit from advance in currency as well.”
Government bonds rose. The yield on the 3 percent notes due September 2024 declined two basis points, or 0.02 percentage point, to 2.19 percent, Korea Exchange prices show. That’s the lowest for a benchmark 10-year security in data compiled by Bloomberg since 2000. The three-year yield was steady at 1.80 percent, matching the record low reached March 20.