South Korean Won Retreats as Investors Cautious Before Fed, BOJ

South Korea’s won headed for its steepest drop in almost a week as investors awaited policy decisions from the Bank of Japan and the Federal Reserve on Wednesday.

The currency was the biggest decliner among Asian counterparts as market-based odds showed there’s a 20 percent chance the Fed will raise interest rates on Sept. 21. Demand for Malaysia’s ringgit was limited as Brent crude remained below $50 per barrel.

“Investors are staying cautious ahead of the Fed and BOJ,” said Timothy Peng, a currency trader at INTL FCStone Ltd. in Singapore. “The ringgit remains under pressure due to weak oil prices.”

The won retreated 0.2 percent to 1,120.75 per dollar as of 9:47 a.m. in Seoul, according to prices from local banks compiled by Bloomberg. The ringgit was little changed at 4.1382 per dollar.

Ten-year South Korean government notes fell, pushing up the yield one basis point to 1.6 percent, the highest since June, prices from local banks compiled by Bloomberg show.

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