The won dropped for the first time in a week as the yen’s decline following the Group of 20 nations meeting sparked concern South Korea will step in to weaken its currency to support exports. Government bonds gained.
The yen fell against the dollar and the won after the G-20 refrained from censuring Japanese policies that have driven the currency’s decline. Bank of Korea Governor Kim Choong Soo said in an interview with the Wall Street Journal in Moscow that the monetary authority will closely monitor the impact of Japan’s policy stimulus on the South Korean economy.
“There were expectations the G-20 would comment on the Japanese currency and that didn’t happen,” said Jeon Seung Ji, an analyst at Samsung Futures Inc. in Seoul. “That’s prompting the drop in the won, which had gained a lot” before the meeting, she said.
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