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USD/KRW: South Korean Won hits four-year low

  • Korea Won hits the lowest level since February 2016.
  • Bank of Korea said it will seek measures to stabilize markets. 

Korean Won (KRW) is on the offer and extending Thursday's slide. 

The currency fell to a four-year low of 1225.69 per US dollar a few minutes before press time and was last seen trading at 1,224 per US dollar, representing a 1.15% drop on the day. The local unit fell by over 1.65% on Thursday as financial markets melted on coronavirus fears. The S&P 500, a benchmark for global equities fell by 9.5 percent. 

Intervention suspected

The USD/KRW pair saw a quick drop from 1,225 to 1,218 during the five minutes to 00:30 GMT. The move triggered speculation about central bank intervention. Some traders believe Bank of Korea bought won and sold dollars to halt the slide in the national currency. 

The central bank hasn't confirmed intervention yet, but was out on the wires a few minutes ago, assuring intervention in money markets if needed. The bank said that it will seek policy measures to stabilize markets and closely monitor the spike in local bond yields. 

The 10-year Korean bond yield gapped higher on Friday at 1.526% and was last seen at 1.60%, having closed Thursday at 1.386%. 

Technical levels


 

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