SEOUL: South Korea’s won headed for a fifth weekly gain, the longest rally since December 2013, as signs the Federal Reserve will delay raising interest rates boosted demand for emerging-market assets.
Overseas funds pumped $1.3 billion into South Korean stocks this week, the most since August, as U.S. economic data that missed estimates weakened the case for an imminent rate rise. They bought a net $365 million of local bonds in the four days through Thursday, official data show. The U.S. Treasury this week reaffirmed its stance that South Korea must reduce market intervention and let the won strengthen.
The won climbed 0.7 percent since April 10 and 0.3 percent on Friday to 1,085.23 a dollar as of 10:13 a.m. in Seoul, data compiled by Bloomberg show. The currency has strengthened 4 percent over five weeks and is now up 0.5 percent this year.
“Sentiment toward riskier assets heightened recently, leading to foreigners’ net purchases of equities,” said Suh Daeil, an economist at Daewoo Securities Co. in Seoul. “Pressure from the U.S. on South Korea’s operations in the currency market also pushed the won up, and the impact can last until next week.”
