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Seoul: Won hits 2-year low before Fed chief's testimony; shares down
[SEOUL] The South Korean won skidded to a 2-year low against the dollar on Tuesday morning, as Greece's deal with is creditors allowed markets to refocus their attention on the greenback which is being bolstered by expectations of higher interest rates later this year.
The won was down 0.7 per cent at 1,138.0 per dollar as of 0233 GMT after falling as low as 1,140.7, the lowest level since July 10, 2013.
"The Greece issue is no longer in the spotlight and investors are now looking at US markets as the Fed chief is expected to keep her stance that interest rates will be raised within the year," said Jeon Seung-ji, a foreign-exchange analyst at Samsung Futures.
Market participants are keeping an eye on Federal Reserve Chair Janet Yellen's semi-annual testimony on monetary policy later in the week which is largely expected to mirror her news conference last Friday.
Mr Jeon added the won is expected to trade within 1,135 and 1,142 on Tuesday.
Seoul shares were set to break a three-day winning streak as market bellwether Samsung Electronics and another chipmaker SK Hynix fell after China's Tsinghua Unigroup Ltd offered to buy their US rival Micron Technology Inc.
The Korea Composite Stock Price Index (KOSPI) was down 0.1 per cent at 2,058.77 points from the previous close at 2,061.52. Gainers led losers by 1.85 to 1.
Technology giant Samsung Electronics Co Ltd, which makes up 12 per cent of the main bourse's market value, was down 3.0 per cent at 1,227,000 won.
SK Hynix Inc lost 5.8 per cent after falling as much as 6.8 per cent to 37,800 won, the lowest since April 17, 2014.
September futures on three-year treasury bonds were down 0.01 point at 109.03.