Watchdog intensifies pressure on financial firms amid persistent won weakness

The Korea Times

Watchdog intensifies pressure on financial firms amid persistent won weakness

Korea's financial watchdog is launching a series of meetings with banks, brokerages and insurers as policymakers step up efforts to curb volatility in the foreign exchange market amid persistent weakness in the won. The move comes as expectations of higher U.S. interest rates and sustained foreign investor outflows continue to weigh on the Korean currency. The Financial Supervisory Service (FSS) began consultations with the banking sector on Tuesday and plans to hold similar meetings with securities firms and insurers in the near future. The won has come under mounting pressure as overseas investors lock in gains and rebalance portfolios away from Korean equities. As of Friday, the average won-dollar exchange rate for the second quarter had risen to 1,491 won, its highest level since the aftermath of the Asian financial crisis in 1998. The currency has also traded above the psychologically significant 1,500-per-dollar threshold for 16 sessions. In Seoul's onshore foreign exchange market, the won closed at 1,512.1 per dollar, up 22.9 won from the previous session. At Tuesday's meeting, th

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