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| Gettyimagesbank |
South Korea’s currency rose to a fresh 30-month high against the U.S. dollar on Friday, propelled by signs of progress in U.S. stimulus talks and the development of coronavirus vaccines.
The won closed at 1,082.10 won per U.S. dollar, sharply up 14.9 won from the previous session’s close.
It marked the strongest level since June 14, 2018, when the won closed at 1,083.10 won per U.S. dollar.
The won’s rally was encouraged by prospects over a big U.S. economic stimulus measure and breakthroughs in COVID-19 vaccines.
The won, along with other peers, has strengthened against the U.S. dollar due to optimism over vaccine developments, with U.S. President-elect Joe Biden promising to swiftly deal with stimulus packages.
The U.S. dollar has also been weakening since the U.S. Federal Reserve said in its September rate-setting meeting that it will keep interest rates near zero until inflation is on track to meet its 2 percent target.
Jeon Seung-ji, a currency analyst at Samsung Futures Inc., said South Korea’s current account surplus, which exceeded $10 billion for the second straight month in October, partly reflected the won’s strength earlier in the day.
Analysts have said the U.S. dollar’s weakening may continue for the time being as investors sold safe-haven assets over the development of coronavirus vaccines.
Last month, Finance Minister Hong Nam-ki said financial authorities have been closely monitoring the foreign exchange market, warning that they are ready to take action at any time to smooth out the local currency’s sharp gains.
Hong voiced concerns about the Korean currency’s rapid strength against the U.S. dollar, saying that excessive currency volatility is not desirable.