Bloomberg News

Korean Won Rebounds on European Summit Progress, Japan Exports

October 24, 2011

Oct. 24 (Bloomberg) -- South Korea’s won rose for the first time in three days as European leaders made some progress on reaching a pact to contain the region’s debt crisis and Japan reported better-than-expected exports.

European officials excluded a forced restructuring of Greek debt, sticking with the tactic of enticing bondholders to accept losses to restore the country’s finances. They are due to meet again on Oct. 26. Japan’s overseas shipments rose 2.4 percent last month from a year earlier, the Ministry of Finance said in Tokyo today. The median estimate of 26 economists surveyed by Bloomberg was for a 1 percent increase. The Kospi share index rose 3.3 percent, the most since Sept. 27.

“The won rose as European leaders moved toward agreement during the weekend, and as Kospi gains triggered some risk- taking,” said Lee Jin Ill, a Seoul-based senior currency trader at Hana Bank. “Exporters’ selling dollars to convert income also supported the currency.”

The won jumped 1.1 percent to 1,134.60 per dollar, according to data compiled by Bloomberg. The currency has weakened 1.2 percent against the dollar this year.

The government’s benchmark three-year bonds fell for a second day, pushing yields to a three-week high. The yield on the 3.5 percent notes due June 2014 rose three basis points, or 0.03 percentage point, to 3.54 percent, Korea Exchange Inc. prices show.

--Editors: Sandy Hendry, Ven Ram

To contact the reporter on this story: Jiyeun Lee in Seoul at jlee1029@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.


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