The won dropped to a six-month low as escalating tensions with North Korea curbed global funds’ demand for South Korean assets. Government bonds rose.
The North hasn’t responded to a daily request to allow South Korean workers into the jointly run Gaeseong industrial zone today, withholding approval for the first time since 2009. The communist state said March 30 that a “state of war” exists with the South and warned it may shut the industrial zone following recent flights over the Korean peninsula by U.S. stealth bombers. Overseas investors sold more Korean shares than they bought today, exchange data show.
The won weakened 0.4 percent to 1,122.77 per dollar as of 10:06 a.m. in Seoul, earlier touching 1,123.34, the lowest level since Sept. 20, according to data compiled by Bloomberg. The currency slid 0.3 percent yesterday after North Korea said it will restart the Yongbyon nuclear site, which was shut down in 2007 as part of an agreement reached in six-nation talks aimed at persuading the nation to scrap its nuclear arms program.
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