Korean Won Falls Toward Three-Month Low as Exports Disappointby
South Korea’s won approached its weakest level in three months after a central-bank report showed exports were a drag on economic growth last quarter.
The currency dropped for the third time in four days amid concern China will allow the yuan to keep weakening, putting downward pressure on its Asian counterparts. Korea’s gross domestic product growth slowed in the three months through September, though it exceeded the median forecast of economists surveyed by Bloomberg.
“GDP data came out better-than-expected but the numbers on exports showed signs of weakness,” said Jeon Seung-ji, a currency analyst at Samsung Futures Inc. in Seoul. “I don’t think the data will give much help to the won today, especially since all the focus is on the depreciating yuan.”
The won declined 0.5 percent to 1,137.48 per dollar as of 9:54 a.m. in Seoul after sliding to 1,143.65 on Oct. 17, the weakest level since July 21. The currency has dropped 1.3 percent in the past four days.
The economy expanded 0.7 percent in the third quarter from the prior three months, when it expanded 0.8 percent, according to data released by the central bank. Export growth slowed, and net exports shaved 0.6 percentage point off GDP, the data showed.
The offshore yuan fell to a record as Chinese policy makers signaled they are willing to allow greater currency flexibility amid a slide in exports. The exchange rate dropped to 6.7885, the weakest level in data starting in 2010.
Overseas investors have cut their holdings of Korean shares by $12 million so far on Tuesday after a local media report showed China had placed orders to reduce the number of tourists to the country.