SEOUL: The South Korean won held firmly onto gains made early on Tuesday, tracing domestic and US stocks as risk appetites were boosted by upbeat corporate earnings and stronger-than-expected retail data from the US
The won found additional support from growing talk that Spain may ask for a bailout possibly as soon as next month.
The local currency was quoted at 1,107.2 against the dollar at the end of local trade, compared to Monday's domestic close at 1,110.5.
It reached as high as 1,106.0 during intraday trade, the highest since October 31, 2011.
Some dollar sales linked to a 3.5 trillion won ($3.15 billion) contract won by South Korea's Hyundai Heavy Industries Co also played out as a positive factor for the won, dealers said.
A foreign bank dealer in Seoul said that whenever the appetite for risk increase, the won would "naturally track that movement." The Korean currency "will try to move further up, but it will likely do so at a very slow pace," he said.
With the won at its highest levels this year, traders have been reluctant to push it higher in recent weeks out of caution that local authorities might intervene to weaken the currency.
The benchmark Korea Composite Stock Price Index rose 0.8 percent on Tuesday from a one-month low hit the previous day. Foreigners were net sellers of 40.3 billion won worth of South Korean stocks on Tuesday.
Local bonds unwound recent gains led by foreigners as the local stock market rose. December futures on three-year treasury bonds fell 0.09 points to 106.24.
Yield on the benchmark five-year treasury bonds rose 3 basis points to 2.85 percent, while yield on the three-year treasury bonds added 2 basis points to 2.78 percent.
Comments
Comments are closed for this article.