The Bank of Korea is one of the major participants in the ongoing global currency war, intervening on behalf of gain of us $ 1 billion per day! Meanwhile, the Korean won has increased 5% in the last month, and 10% in the last three months, the highest in Asia. What a disconnect!
Firstly, what's behind the rise of the recording of the Korean won? In short, everything. At the moment, things couldn't be going nothing better for Korea won. The economy is growing. The current account/trade surplus is on pace to surpass expectations. The Central Bank has hiked its benchmark interest rate once already for 2. 25% and probably will walk again this month. In addition.Although Korean debt is growing, "he is ranked 99 between 129 Nations in terms of the ratio of government debt to gross domestic product (GDP), which means that the country's balance is healthier than most other nations of the world."Added another analyst, "in this period where there is much concern about the debtor Nations, countries that are considered to have greater benefit credit score."
While the Korean stock market rose (13% of this ear and 50% last year), it still remains 25% below its peak of 2007 and is trading at ratings well below other Asian countries.No wonder that foreign investors were net buyers of reserves in Korean: "Foreigners bought more actions Korean who sold everyday for four weeks and net purchases for the amount of year to about 13 billion dollars" doesn't hurt investors that the currency is appreciating and interest rates are rising moment, there are really very disadvantage to invest in Korea.
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