SEOUL, September 03 (AJP) - The South Korean won climbed to a 14-month high against the dollar Thursday, while government bonds rallied as global yields eased after a sharp selloff.
The won ended daytime trading at 1,359.3 per dollar, strengthening 0.7 percent from Wednesday and marking its strongest close since July 2, 2025.
It touched 1,355.9 during the session, the strongest intraday level since July 3 last year.
Exporter dollar selling added to broader weakness in the U.S. currency, while a firmer Japanese yen also supported the Korean currency.
The dollar index hovered around 99.3 shortly after the Seoul close.
The yen strengthened to around 157 per dollar as expectations for tighter Bank of Japan policy and concerns over possible intervention supported the Japanese currency.
The won held most of its gains despite continued foreign selling of Korean equities.
Foreign investors remained net sellers on the KOSPI for a fifth straight session, while the benchmark index edged up 0.26 percent to 6,579.48.
South Korean government bonds also strengthened across maturities, reversing part of the sharp rise in yields seen over the previous four sessions.
The three-year Korean government bond yield fell 4.2 basis points to 3.888 percent, while the five-year yield dropped 4.9 basis points to 4.118 percent.
The 10-year yield declined 5.1 basis points to 4.367 percent, according to final quotations from the Korea Financial Investment Association.
Ultra-long maturities also rallied, though by less than shorter tenors.
The 20-year yield fell 2.1 basis points to 4.593 percent, while the 30-year yield declined 2.2 basis points to 4.635 percent.
The weaker performance at the ultra-long end widened the gap between the 10- and 30-year yields to 26.8 basis points from 23.9 basis points a day earlier.
Korean bonds tracked an overnight recovery in U.S. Treasuries and further declines in global yields during Asian trading.
The U.S. 10-year Treasury yield eased after weaker-than-expected private employment data, while Japanese government bond yields retreated from recent highs.
U.S. private payrolls increased by 38,000 in August, below market expectations and reinforcing caution ahead of Friday's nonfarm payroll report.
Oil prices also retreated during Asian trading after recent gains, easing some inflation concerns that had contributed to the global bond selloff.
Foreign investors returned to the three-year Korean government bond futures market, buying more than 9,000 contracts after heavy selling over the previous five sessions.
Thursday's rally offered some relief after the rapid repricing in global sovereign bonds.
Still, the relative underperformance of Korea's 20- and 30-year maturities showed that investors remained cautious about taking duration risk at the ultra-long end.
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