South Korea's currency depreciated against the U.S. dollar last month as foreign capital inflow was offset by growing expectations for higher interest rates in advanced economies, central bank data showed Wednesday.
The won/dollar exchange rate was quoted at 1,144.1 won per dollar as of end-June, up 2.2 percent from a month earlier, according to the Bank of Korea (BOK).
The weaker won came as the U.S. Federal Reserve raised its interest rate in June to a range of 1.00-1.25 percent.
The BOK has kept its benchmark interest rate at an all-time low of 1.25 percent for more than a year.
Chief of the European Central Bank (ECB) indicated a rate hike in late June, saying deflationary threats disappeared.
Limiting the South Korean currency's further depreciation, 3.09 billion dollars of foreign funds flowed into the local securities market in June, including 1.72 billion dollars in stocks and 1.37 billion dollars in bonds.
Daily volatility in the won/dollar exchange rate averaged 3.2 won per dollar in June, down from 4.6 won in May.
Premium on credit default swap for five-year sovereign debts of South Korea was 52 basis points in June, down 5 basis points from the previous month.
It indicated lower sovereign risks as the premium means additional costs to issue sovereign bonds.
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