S.Korea needs to scrutinise won volatility- finance min
November 21, 2012 11:42 AM EST
South Korea needs to scrutinise the won's recent volatility and will take action to stabilise the exchange rate if necessary, Finance Minister Bahk Jae-wan said on Wednesday, the latest warning against the currency's sharp rise.
"The government will closely monitor domestic and international financial market conditions and take appropriate measures should conditions warrant a response," Bahk said at a weekly policy meeting.
Bahk's comments contrast with the views of Vice Finance Minister Shin Je-yoon who said on Tuesday he did not believe current market conditions demanded new regulations to reduce the risks from rapid foreign capital inflows.
At the end of Tuesday's onshore trading, the local currency was up 0.9 percent against the dollar for the week. Currency dealers suspect that the Korean foreign-exchange authorities have been intervening to slow the won's appreciation.
The Bank of Korea and the Financial Supervisory Service are also conducting a joint inspection of foreign exchange trading at banks operating in the country.
Analysts say the authorities' foreign-exchange trading inspection was aimed at trying to slow the local currency's appreciation. The checks do not occur on a set schedule but rather when the regulators see a need to show a heightened level of surveillance, they noted.
Though the authorities denied that any change in regulatory policy was imminent, some analysts and foreign-exchange market participants believe the authorities may lower the caps on banks' currency derivative positions to undercut speculation on the won.
(Reporting by Lee Shin-hyung and Se Young Lee; Editing by Eric Meijer)
Join the Conversation
- Russia Is Ready for Shooting War, Will Likely Win Looming Nuclear Showdown with U.S. – Report
- Kobani ISIS Fighter Sends Out Desperate Message For Prayers And Support: Euphoria Turns Into Desperation As Kurds Advance
- Home Depot Early Black Friday 2014 Sale Up To Nov. 29, 2014 Includes Special Buys On Appliances Such As Samsung Refrigerators, Whirlpool Electric Ranges And Hoover Vacuum Cleaners
- Microsoft Band Runs Out Of Stock, But Offers $10 Gift Voucher To Wait-Listed Customers
- ISIS War: US Airstrikes Lead to Growing ISIS Support In Syria; Russia Questions Coalition's Policies
- Google Joins Forces with GoPro Inc with New Google Maps Focusing on Destination
- Target Early Black Friday 2014 Sale Ad Released For Nov. 26, 2014 Includes Deals On Toys, HDTVs And Video Games Such As ‘FIFA 15’ And ‘NHL 15’ For Xbox 360 [WATCH VIDEO]