Published September 3, 2010
S Korean won soars, bonds fall
IMF says the currency is undervalued; it also raises its forecast for the economy
(SEOUL) South Korea's won rose to its strongest level in two weeks after the International Monetary Fund said the currency was 'undervalued' and raised its economic growth forecast for the nation.
The won gained for a second day as exchange data showed overseas funds bought more local stocks than they sold for the first time in three days.
South Korea's economic recovery is strong and the nation still has room to raise borrowing costs, Subir Lall, the IMF's mission chief to the country, said on Monda. The MSCI Asia-Pacific Index of regional shares advanced after growth in US manufacturing boosted confidence in the global recovery. South Korea's 10-year bonds fell. The IMF's comments 'affected the won,' said Kim Sung Soon, a currency dealer at Industrial Bank of Korea in Seoul. 'There are some inflows from foreign stock and bond investors. The global sentiment is changing from risk aversion.'
The won climbed 0.3 per cent to 1,180.90 per dollar at the 3 pm close in Seoul. It has gained 2.7 per cent this quarter. The benchmark Kospi stock index rose 0.6 per cent yesterday.
The IMF increased its growth forecast for South Korea's gross domestic product to 6.1 per cent for 2010 from a July estimate of 5.75 per cent.
South Korea's 10-year government bonds fell, with the yield on the 5 percent note due in June 2020 increasing one basis point to 4.41 per cent, according to prices from Korea Stock Exchange. -- Bloomberg
S Korean won soars, bonds fall
IMF says the currency is undervalued; it also raises its forecast for the economy
(SEOUL) South Korea's won rose to its strongest level in two weeks after the International Monetary Fund said the currency was 'undervalued' and raised its economic growth forecast for the nation.
The won gained for a second day as exchange data showed overseas funds bought more local stocks than they sold for the first time in three days.
South Korea's economic recovery is strong and the nation still has room to raise borrowing costs, Subir Lall, the IMF's mission chief to the country, said on Monda. The MSCI Asia-Pacific Index of regional shares advanced after growth in US manufacturing boosted confidence in the global recovery. South Korea's 10-year bonds fell. The IMF's comments 'affected the won,' said Kim Sung Soon, a currency dealer at Industrial Bank of Korea in Seoul. 'There are some inflows from foreign stock and bond investors. The global sentiment is changing from risk aversion.'
The won climbed 0.3 per cent to 1,180.90 per dollar at the 3 pm close in Seoul. It has gained 2.7 per cent this quarter. The benchmark Kospi stock index rose 0.6 per cent yesterday.
The IMF increased its growth forecast for South Korea's gross domestic product to 6.1 per cent for 2010 from a July estimate of 5.75 per cent.
South Korea's 10-year government bonds fell, with the yield on the 5 percent note due in June 2020 increasing one basis point to 4.41 per cent, according to prices from Korea Stock Exchange. -- Bloomberg