SEOUL: The South Korean won edged down in domestic trade on Monday as investors took profits in the absence of major news to generate momentum and on wariness over further intervention from local authorities.
The currency was quoted at 1,056.1 against the dollar at the end of onshore trade, compared with 1,054.7 on Friday. It was the first daily decline for the won in five trading days.
Dealers said there was some talk of short-covering on the dollar by offshore investors.
"There is some wariness about the foreign-exchange authorities, and there is also some talk about dollar-buying from offshore; bids on the dollar appear pretty firm," a local bank dealer said.
Another local bank dealer said some importers were buying the dollar on the low with the won.
Market participants say that South Korean authorities have been buying dollars in recent sessions in a bid to slow the currency's appreciation against the dollar, though there was no talk of such activity on Monday.
The currency rose by 7.6 percent against the dollar last year and is up by another 1.4 percent so far this month, leading to repeated warnings from policymakers that additional regulatory steps may be taken to curb the rapid gains.
The benchmark Korea Composite Stock Price Index closed up 0.5 percent at 2,007.04 points. Foreigners were net sellers of 96.2 billion Korean won ($91.21 million) worth of local shares on Monday.
Local bonds were little changed, with investors uncertain about what the Bank of Korea's next rate decision will be. March futures on three-year treasury bonds ended down 0.02 points at 106.23.
Yield on the benchmark five-year treasury bonds ended up one basis point from Friday's close, while yield on the three-year treasury bonds was unchanged.
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