Korean Currency Expected to Fall Further Against U.S. Dollar
Foreign investors are continuing to sell South Korean stocks. Their net selling in KOSPI amounted to more than 15.24 trillion won from Jan. 3 to July 6, when KOSPI dipped below 2,300 points for the first time in 20 months. For reference, the amount was 24.5652 trillion won in 2021 as a whole.
From Jan. 3 to July 6, their net selling of the Samsung Electronics common and LG Energy Solution stocks amounted to 9.405 trillion won and 2.796 trillion won, respectively. In addition, their net selling of the Naver, Samsung Electronics preferred and Samsung SDI stocks reached 1.599 trillion won, 1.27 trillion won and 1.167 trillion won, respectively. In that period, the ratio of their investment to the KOSPI market cap fell to 30.78 percent.
On July 6, the won-dollar exchange rate rose 6 won per U.S. dollar to close at 1,306.3 won. The starting rate was 1,308.5 won and the highest of the session was 1,311 won, this year’s new high and the highest since July 13, 2009.
“This month, the Fed is likely to raise rates by 0.75 percentage point for the second consecutive month,” said a market source, adding, “In other words, the value of the South Korean currency may fall further along with foreign investors’ investment in the South Korean stock market.”