South Korea’s Won Jumps the Quickest in Three Weeks on U.S. Economic Data


South Korea’s Won Jumps the Quickest in Three Weeks on U.S. Economic DataThe South Korean won grew by the fastest pace in three weeks after weak U.S. first quarter GDP data fuelled bets that the Federal Reserve will retain the record-low interest rates for a considerable time.

The won advanced 0.5 percent to trade at 1,016.31 per dollar in Seoul trade. The currency has strengthened nearly 14 percent over the past year, the biggest advance among 31 main currencies. The won touched 1,015.25 on June 10, the highest level since August 2008.

Foreign funds sold a net of South Korean shares more than they purchased on Wednesday. The currency fell after the Commerce Department reported yesterday that the U.S. economy shrunk by 2.9 percent in the first quarter, the weakest performance since 2009.


“The dollar weakened across the board after the GDP data,” Son Eun Jeong, a currency strategist at Woori Futures Co in Seoul was quoted by Bloomberg as saying. “Month-end dollar sales by exporters and foreign equity buying are other forces strengthening the won.”

Federal Reserve Chairwoman Janet Yellen signaled last week that the central bank intends to maintain the record-low interest rates for some time, which have been practically zero since December 2008. The U.S. central bank also lowered its outlook for GDP growth this year.

The won’s one-month implied volatility, which tracks the expected swings in the exchange rate used to assign price to options, plunged 0.16 percentage point, or 16 basis points, to 4.48 percent.

Yield on 2.75 percent notes that mature in June 2017 surged two basis points to 2.71 percent in Seoul. The 10-year yield declined one basis point to stand at 3.21 percent. To register for a free 2-week subscription to ForexMinute Premium Plan, visit

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