The South Korean won dropped today as the nation’s government warned against speculative bets on the currency. Officials were worried that the herd behavior of traders results in sharp moves and unwarranted volatility of the exchange rate.
The growing South Korea’s economy was attracting overseas investors, and this resulted in a huge jump for the currency last week. This worried the government, and it warned against the one-sided bets on the exchange rate. The won fell as a result, but analysts speculate that losses will be limited as exporters will be selling dollars whenever the domestic currency weakens.
USD/KRW rose from 1,024.40 to 1024.65 as of 12:07 GMT today.
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