S.Korea c.bank says it will stabilise financial, FX markets if needed

SEOUL Fri Jan 3, 2014 12:20am EST

SEOUL Jan 3 (Reuters) - South Korea's central bank will carry out appropriate measures to stabilise local financial markets if needed, its chief said on Friday, echoing the finance ministry's warning that volatility in the foreign exchange market has to be curbed.

"We will strengthen our monitoring for offshore flows and when needed will carry out stabilising measures for financial and foreign exchange markets," said Bank of Korea Governor Kim Choong-soo in a New Year's address to financial institutions in Seoul.

The Bank of Korea regularly intervenes in FX markets although it does not disclose or confirm the details of its actions.

The governor's remarks on financial markets came just hours after Finance Minister Hyun Oh-seok said the government is closely watching the won's exchange rate movements and the ongoing depreciation of the yen.

Both the central bank and finance ministry's comments added to a stack of warnings issued on Thursday when the won touched its strongest level in more than five years against the dollar and the yen.

The won slipped against the dollar early on Friday, erasing most of its gains from the previous trading session following the remarks and on the Seoul bourse's weak performance.

The strengthening won has sent stocks of major export heavyweights such as Samsung Electronics Co Ltd and Hyundai Motor Co down on fears their earnings may suffer. (Reporting by Christine Kim; Editing by Richard Borsuk)

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