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Seoul: Won, stocks slip as Fed, BOJ meetings eyed

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[SEOUL] The South Korean won fell to a one-week low on Monday morning as market players took dollar-long positions ahead of a policy meeting of the US Federal Reserve later this week.

The local currency stood at 1,149.0 per US dollar as of 0220 GMT, down 0.5 per cent from Friday's close of 1,143.1. Analysts said market participants will also closely watch a policy meeting by the Bank of Japan that is also this week.

"The Fed is unlikely to divert from its previous stance and will probably be neutral. The main issue will be the BOJ decision," said June Park, a foreign exchange analyst at Daishin Economic Research Institute.

"In the short-term, if they cut rates further it will curb the yen's strength, pressuring our currency against the dollar in turn."

The BOJ is considering applying negative rates on lending facilities for banks, Bloomberg reported on April 22.

South Korean shares edged down while investors held back, eyeing major central banks' monetary policy decisions.

The Korea Composite Stock Price Index (KOSPI) was down 0.2 per cent at 2,011.97 points.

Foreign investors were set to be buyers for a ninth straight session, purchasing a net 91.2 billion Korean won (S$107.6 million) of KOSPI shares near mid-session.

Decliners outnumbered advancers 488 to 316.

Market heavyweight Posco fell 3.8 per cent on profit-taking while screenmaker Samsung SDI Co Ltd rose 4.1 per cent.

Major shipbuilder Hyundai Heavy Industries Co Ltd was down 5.2 per cent.

June futures on three-year treasury bonds gained 0.07 point to 110.34.

REUTERS