South Korea to inhibit fluctuations in Won
In an unconventional move, South Korea has announced it will restrict access to real-time forex data to a select group of banks, in order to stem what it has deemed ‘excessive volatility’ in the Korean Won. For years, South Korea has overtly intervened in forex markets in order to maintain a cheap currency. However, as the Won has appreciated nearly 5% in the last three months, South Korea is now turning to a les cut-and-dried method for depreciating its currency. The nation’s Central Bank apparently believes that using delayed forex quotes will limit speculation and increase liquidity. The Korean Herald reports:
Under the new trading system, companies and offshore traders will not be able to access the real time information shared by foreign exchange banks. All the currency transactions among nonbank market participants will be made based on the "reference rate" among foreign exchange banks.
