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Won weakens on suspected intervention

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(Globalpost/GlobalPost)

By Lee Minji

SEOUL, May 14 (Yonhap) -- The Korean won ended lower on Wednesday on speculation that local authorities intervened to tame the local currency's sharp ascent.

After hitting 1,021.3 per dollar at one point, the local currency turned south to close at 1,027.9, down 5.8 won from the previous close.

Market watchers attributed the won's fall to suspected dollar purchases by local foreign exchange authorities.

"The won weakened to 1,030 against the greenback at one point. The government succeeded in sending out a strong message (to the market)," said Jung Kyung-parl, a currency analyst at KEB Futures Co.

Jung, however, forecast the won's upward strength to continue into early June when the 2016 outlooks for the euro zone inflation are due.

The won's decline comes on the heels of remarks by government officials in which they signaled firm will to act against speculative market forces.

The Korean won has strengthened more than 3 percent against the greenback since March this year. Government officials, including Finance Minister Hyun Oh-seok, have repeatedly said authorities would not tolerate any speculative moves or sharp volatility on the currency market.

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http://www.globalpost.com/dispatch/news/yonhap-news-agency/140514/won-weakens-suspected-intervention