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S.Korean currency's volatility rises to USD in April

SEOUL
2018-05-09 16:45

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South Korean currency's volatility rose against the U.S. dollar in April on expectations that the country's foreign exchange authorities would refrain from intervening in the currency market, central bank data showed Wednesday.

The session-over-session volatility in the won/dollar exchange rate averaged 0.38 percent in April, up from the prior month's 0.32 percent, according to the Bank of Korea (BOK).

It was the third-highest volatility among major currencies, following Russia's ruble and Brazil's real that posted 1.02 percent and 0.64 percent, respectively, in volatility against the greenback.

Higher volatility in the won/dollar exchange rate came amid rising expectations that South Korea's foreign exchange authorities would refrain from intervening in the currency market ahead of the March 14 announcement of the U.S. exchange rate report.

The won/dollar exchange rate averaged 1,068.0 won per dollar in April, down 4.5 won from the previous month's daily average.

Foreigners sold a net 2.04 billion U.S. dollars of local stocks in April on uncertainties over rising U.S. Treasury Bond yields and the stock split of Samsung Electronics, the main bourse bellwether.

Foreign capital of 640 million U.S. dollars flowed last month into the domestic bond market.

Credit default swap (CDS) premium for the five-year foreign exchange stabilization bonds, which reflects sovereign credit risk, averaged 49 basis points in April, unchanged from the previous month.
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