Bahk hints he may step in to put a lid on rising wonFinance Minister Bahk Jae-wan sounded a note of alarm yesterday by drawing attention to the growing volatility of the foreign exchange market.
This was seen as a sign that the government may intervene in the forex market to slow the appreciation of the Korean currency.
“The government will keep monitoring the situation closely and take some measures if necessary,” Bahk said at a crisis management yesterday.
Bahk’s latest comment marked a change in tone from his recent remark that “the foreign exchange market is changing so fast these days,” prompting the government to take note.
The won has appreciated by more than 4 percent to the U.S. dollar this year, raising concern about the potential threat to exports as a strong won makes them more expensive.
Such currency movements have also caused consumer prices to rise this year, a report by the Bank of Korea said yesterday.
Financial pundits say the limits on forward exchange positions?at banks may be lowered next month so fewer dollars flow into the country, in a bid to contain the won’s rise.
The local currency closed at the year’s low of 1,082.20 won against the greenback on Tuesday, up 4.8 won from Monday’s close.
By Song Su-hyun [email@example.com]