Korean Investors Flock to Yen as Won Strengthens Against Dollar
Korean investors are shifting their foreign exchange bets from the U.S. dollar to the Japanese yen as the won has strengthened against the greenback.
The won-dollar exchange rate fell from above 1,550 won in the first half of the year to the 1,300-won range, with the won trading near a record low at around 850 won per 100 yen.
Yen deposits at Korea's five major commercial banks rose to 1.13 trillion yen as of Tuesday, up 47.8 billion yen from the end of August, while dollar deposits fell to $69.15 billion, down $7.19 billion from last month.
The Bank of Japan raised its policy rate to 1.25 percent on Friday, but the yen still weakened due to market expectations that the BOJ would struggle to keep pace with the U.S. Federal Reserve in tightening monetary policy.