SEOUL: The South Korean won was down in early domestic trade on Thursday, tracking the dollar's broad gains after minutes from the US Federal Reserve's October policy meeting suggested the central bank could soon move to taper monetary stimulus.
The local currency was quoted at 1,060.6 against the dollar as of 0210 GMT, compared with Wednesday's domestic close of 1,057.9, on track for its second session of losses.
In the Fed's minutes, central bank officials felt they could decide to start scaling back the massive bond-purchase programme at one of its next few meetings provided that this was warranted by economic growth. Prospects of such tapering bolstered the dollar.
The dollar was further boosted by talk of additional policy easing by the European Central Bank, dealers said.
But the won's decline has been capped by dollar selling by exporters, seeking to take advantage of the currency's gains, keeping the currency within a narrow trading band.
"We're seeing some dollars being sold on the market once the dollar-won rate rose above the 1,060 mark," a foreign bank dealer said. "We'll also need to wait and see what the Bank of Japan announces later today (following its policy meeting), but I think the upside for the dollar is limited at this point."
The benchmark Korea Composite Stock Price Index was down 1 percent at 1,997.85.
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