Stock, foreign exchange markets recover to levels not seen in months

Electronic display boards at Hana Bank in central Seoul show Kospi reaching above 2,500 points and the won-dollar exchange rate reaching below 1,300 won on Thursday. [YONHAP]

Korea’s stock and foreign exchange markets recovered to levels unseen in months following U.S. Federal Reserve Chairman Jerome Powell’s signal on slowing down the pace of upcoming interest rate increases.

The Kospi reached 2,501.43 points on Thursday, rising 1.17 percent. It was the first time the Kospi surpassed 2,500 points since August.

The won rose more than 1.8 percent against the dollar to reach as high as 1,294.6 won.

It was also the first time the won dropped below the 1,200-won range since August after peaking at 1,444.2 won on Oct. 25.

The recovery followed Powell’s remarks on Wednesday that the central bank could slow the pace of interest rate increases at its meeting scheduled to take for two days from Dec. 13.

“The time for moderating the pace of rate increases may come as soon as the December meeting,” said Powell during a speech at the Brookings Institution in Washington. But he added, “cutting rates is not something we want to do soon. So that’s why we’re slowing down, and going to try to find our way to what that right level is.”