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Seoul: Won falls on rate-cut outlook, short-covering; equities slide
[SEOUL] The South Korean won was driven lower on Thursday by strengthening expectations of an interest rate cut from the Bank of Korea, after Singapore's unexpected policy easing on Wednesday put pressure on regional peers to follow.
Falls in the won widened later in the session as dollar/won shorts were squeezed out of their positions in anticipation of exporter demand for won from month-end settlements.
The won was quoted at 1,093.9 to the dollar at the conclusion of onshore trade, compared to 1,084.5 seen at the end of Wednesday's session.
South Korean shares slipped after the US Federal Reserve indicated that it remained on course to raise interest rates this year in a surprisingly hawkish stance, despite a rather murky outlook for global growth.
The Korea Composite Stock Price Index (KOSPI) fell 0.54 per cent to close at 1,951.02 points, stepping back from a seven-week high posted in the previous session.