Already a Bloomberg.com user?
Sign in with the same account.
South Korea’s won advanced and bonds fell as unemployment in Asia’s fourth-biggest economy dropped to a four-month low and global stock markets rallied.
The jobless rate slipped to 3.2 percent in May from 3.4 percent a month earlier, statistics office data showed today. The Kospi (KOSPI) Index gained 0.3 percent and shares in the U.S. climbed after Federal Reserve Bank of Chicago President Charles Evans said he would support measures to generate faster job growth in the world’s largest economy.
“The won was supported by U.S. stocks gaining on speculation there may be another round of monetary easing,” said Kim Do Hee, a Seoul-based currency trader at Australia & New Zealand Banking Group Ltd. “The currency trimmed gains in the afternoon as some investors covered their short positions on the dollar due to lingering uncertainties in the financial market.” A short position is a bet an asset will decline.
The won advanced 0.2 percent to 1,168.35 per dollar at the close in Seoul, after gaining as much as 0.4 percent, according to data compiled by Bloomberg. Its one-month implied volatility, a measure of exchange-rate swings used to price options, dropped 35 basis points to 10.50 percent.
The yield on Spain’s 10-year sovereign debt touched 6.83 percent yesterday, the highest since 1997, raising the specter of a bailout for the government.
The International Monetary Fund cut South Korea’s growth forecast for this year to 3.25 percent from 3.5 percent, citing “substantial” uncertainty due to Europe’s deepening debt turmoil, according to a statement yesterday. South Korea’s Finance Minister Bahk Jae Wan said today that the government is enhancing monitoring to prepare for shocks.
The yield on the government’s 3.5 percent bonds due March 2017 rose four basis points, or 0.04 percentage point, to 3.44 percent, Korea Exchange Inc. prices show. Three-year debt futures fell 0.03 to 104.74 and one-year interest-rate swaps was little changed at 3.31 percent.
To contact the reporter on this story: Jiyeun Lee in Seoul at email@example.com
To contact the editor responsible for this story: Sandy Hendry at firstname.lastname@example.org