The Seoul Stock Exchange fell on Friday, while the won plunged to its lowest level in fifteen years, against a backdrop of a worsening political crisis in South Korea, while the yen tried to recover in a market suspended at the Bank of Korea. Japan.
South Korean MPs voted Friday to impeach interim President Han Duck-soo, accusing him of having ‘actively participated in the insurrection’ after his predecessor’s failed attempt to impose martial law on December 3.
At the same time, a composite index of South Korean investor sentiment released on Friday showed the biggest fall since April 2020 and the start of the Covid pandemic.
In addition to the uncertainty of the political climate in the country, businesses are worried about the protectionist measures that US President-elect Donald Trump could take when he arrives at the White House in January.
Enough to weigh down the markets: on the Seoul Stock Exchange, the flagship Kospi index ended down 1.02% at 2404.77 points, after falling during the session to its lowest level in three weeks.
Securities were particularly attacked, such as E-Mart, the country’s largest hypermarket chain (-9.40%), which is preparing to merge its digital branch with the Chinese e-commerce giant. -Alibaba commerce.
At the same time, the South Korean currency, which had already fallen sharply in early December after the abortive proclamation of martial law, once again experienced a sudden bout of weakness.
It fell to 1,487.03 won per dollar, its lowest level since the first quarter of 2009. Around 07:30 GMT, it fell 0.48% to 1,474 won.
The yen attempts to rebound after a six-month low, the BoJ intrigues
Friday around 07:30 GMT, the Japanese currency (+0.11% to 157.82 yen per dollar) tried to catch its breath after falling Thursday evening to the lowest level since mid-July, at around 158 yen.
The Japanese currency has fallen for four consecutive sessions this week, penalized by reduced trading volumes and by questions about monetary policy.
Bank of Japan (BoJ) Governor Kazuo Ueda spoke last week of a prolonged pause in the institution’s monetary policy tightening, in the face of internal and international economic uncertainties.
In another intervention, Mr. Ueda explained on Wednesday that rates would continue to be ‘adjusted’ only if the situation continued to improve on the economic and price front: an absence of a clear signal maintaining the perplexity of the operators.
However, Japanese rates which would be maintained at their still extremely low levels would contrast with the high American rates which the Federal Reserve (Fed) only intends to lower gradually. This gap favors investments in dollars, which are more profitable, to the detriment of the yen.
/ATS
