South Korea banks told to report FX positions each hour, Daily reports

SOUTH Korean authorities are tightening their grip on the foreign exchange (FX) market after the won approached a key psychological level of 1,400 per dollar last week.

The government asked banks to report the status of dollar transactions and foreign-exchange-related positions every hour as part of efforts to strengthen monitoring of the currency market, Korea Economic Daily reported on Monday (Sep 19), citing people it didn’t identify.

Banks previously were required to report 3 times a day - in the morning, during the lunch break and after markets closed, the report said, citing an unidentified trader at a major bank. The request to report every hour came on Friday, the report cited the trader as saying.

Authorities are boosting market oversight after the won dropped to 1,399.95 last week, the weakest level since March 2009, despite a string of warnings aimed at arresting the currency’s decline. Emerging Asian currencies have come under pressure as the US Federal Reserve continues to tighten policy and as China’s slowing economy and Europe’s energy crisis fuel fears of a global slowdown. BLOOMBERG