SEOUL: The South Korean won fell in domestic trade Friday, moving in line with local stocks after comments from a U.S. Federal Reserve official on Thursday undercut hopes for another round of monetary stimulus from the central bank.
The won was quoted at 1,134.1 against the dollar at the end of onshore trade Friday, compared with 1,130.5 at the end of the Seoul session on Thursday.
Though minutes from the Fed’s July 31-Aug 1 meeting indicated strong support for more stimulus, St. Louis Federal Reserve President James Bullard played down chances of imminent easing, saying the economic outlook has improved since then.
Foreign outflows from the stock market added to pressure on the won, but dealers said hefty dollar sales by exporters during the session limited the won’s slide.
The benchmark Korea Composite Stock Price Index ended down 1.2 percent at 1,919.81. Foreigners were net sellers of 252.5 billion won ($223.34 million) worth of local shares on Friday.
Local bonds rebounded, recouping some of their recent losses as appetite for risk weakened due to uncertainty over the Fed’s intentions. September futures on three-year treasury bonds rose 0.16 points to 106.06. Yields on the benchmark five-year treasury bonds and three-year treasury bonds each fell by five basis points from Thursday’s close.