South Korean Won Set for Further Losses After Decade-Low Close
- Country relies heavily on energy imports, exports to China
- Won’s decline beyond 1,300 seems “inevitable,” analyst says
South Korean 50,000 won banknotes.
Photographer: SeongJoon Cho/BloombergThis article is for subscribers only.
South Korea’s won is set to extend declines after closing at the weakest level in more than decade on Thursday as the export-driven economy grapples with the impact of China’s Covid lockdowns and high energy prices.
The Korean won is likely to weaken further on continued equity outflows, persistent trade deficit, rising geopolitical tensions, depreciatio in the yuan and Federal Reserve tightening, according to Scotiabank and Hyundai Motor Securities Co. The won dropped 1% Thursday to end the day at 1,288.50 per dollar, its lowest close since July 2009, when the country was still in the throes of the global financial crisis. The currency traded 0.1% higher on Friday.