Based on Bpaynews, South Korea’s Finance Minister Koo Yun-cheol has warned of a stern response to speculative and disorderly trading in the Korean won (KRW) as the currency experiences heightened volatility. Authorities are on high alert, having recently met with local brokerages and the National Pension Service (NPS), though no new measures were announced. Officials emphasized that the NPS will not be directed to support the won, and hedging decisions remain internal. Authorities are also monitoring strong outbound equity flows by residents, which can increase FX volatility. All policy options remain on the table if market conditions worsen, with potential tools including FX smoothing operations and macroprudential adjustments.
South Korea Warns of Stern Response to Won Volatility Amid FX Market Scrutiny
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