The South Korean currency climbed 2.44 percent against the U.S. dollar Friday as the euro's rebound and eased geopolitical risks helped revive investors' appetite for risky assets, dealers said.
The local currency closed at 1,194.90 won to the greenback, up 29.10 won from Thursday's close and the second straight session of gains. The Korean unit rose to an intra-day high of 1,192 won to the dollar at one point in late trading.
"China's denial of sales of its euro assets and Korea's move to curb banks' forward contracts helped the Korean currency stabilize," said Lee Sung-kwon, a chief economist at Shinhan Investment Corp. "But as the eurozone debt crisis is still going on, the local currency could sharply weaken, depending on the development."
The won's sharp gain came after foreign investors bought risky assets following rallies in U.S. markets and the euro's rebound, analysts said.
The single currency in the eurozone bounced back against the dollar after China denied a report that it would cut the weight of euro-denominated assets in its foreign exchange reserves.
The benchmark Korea Composite Stock Price Index (KOSPI) added 0.95 percent to 1,622.78. Foreign investors snatched up a net 71.8 billion won (US$60.1 million) worth of local stocks on the main bourse, snapping nine straight sessions of a selling spree.
South Korea's financial watchdog said Thursday that it is mulling putting some restrictions on inter-bank currency forwards contracts as part of efforts to quell volatility in the foreign exchange market and smooth swings in cross-border capital.//Yonhap
The local currency closed at 1,194.90 won to the greenback, up 29.10 won from Thursday's close and the second straight session of gains. The Korean unit rose to an intra-day high of 1,192 won to the dollar at one point in late trading.
"China's denial of sales of its euro assets and Korea's move to curb banks' forward contracts helped the Korean currency stabilize," said Lee Sung-kwon, a chief economist at Shinhan Investment Corp. "But as the eurozone debt crisis is still going on, the local currency could sharply weaken, depending on the development."
The won's sharp gain came after foreign investors bought risky assets following rallies in U.S. markets and the euro's rebound, analysts said.
The single currency in the eurozone bounced back against the dollar after China denied a report that it would cut the weight of euro-denominated assets in its foreign exchange reserves.
The benchmark Korea Composite Stock Price Index (KOSPI) added 0.95 percent to 1,622.78. Foreign investors snatched up a net 71.8 billion won (US$60.1 million) worth of local stocks on the main bourse, snapping nine straight sessions of a selling spree.
South Korea's financial watchdog said Thursday that it is mulling putting some restrictions on inter-bank currency forwards contracts as part of efforts to quell volatility in the foreign exchange market and smooth swings in cross-border capital.//Yonhap
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