SEOUL: The South Korean won edged lower in early domestic trade Thursday, giving up some of the previous day's gains on concern local authorities might intervene to slow the currency's gains and on importers' dollar demand.
The local currency was quoted at 1,064.0 against the dollar as of 0242 GMT, compared with Wednesday's domestic closing level of 1,062.4.
Dealers said investors are cautious about potential intervention by authorities to slow the won's rebound. The currency is up nearly 1 percent against the dollar this week as worries about a sharp slowdown in China and other emerging markets eased.
On Thursday, the won briefly traded as high as 1,060.9, its highest since Jan. 11, partly due to dollar-selling by exporters. But the currency then retreated as offshore investors pushed the dollar higher.
"I'm sure there was some dollar-selling by exporters but I think there were some dollar-short plays building around this as well," one foreign bank dealer said. "But the volume of dollars being sold was modest and offshore investors started bidding up the dollars, so those shorts were unwound quickly."
Another foreign bank dealer said that importers were spotted buying dollars, undercutting the won further.
The benchmark Korea Composite Stock Price Index was down 0.2 percent at 1,932.17.
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