More Koreans Than Ever Bought Dollars Last Month
19 September, 2019
More Koreans bought strengthening U.S. dollars last month than ever before, according to the Bank of Korea on Wednesday.
The central bank said that foreign currency deposits here totaled US$70.97 billion in August, up $1.3 billion from the previous month.
The deposits include all forex savings held in Korea by individual Koreans, Korean businesses, foreigners who have lived here for more than six months, and foreign companies doing business here.
U.S. dollars took up 95 percent of the increase. Businesses made up for 59 percent of fresh dollar deposits and individuals the rest.
With individual investors buying up dollars as much as export firms, foreign currency deposits held by businesses shrank to 78.3 percent while individual holdings jumped to 21.7 percent -- the highest since the BOK started gathering statistics in 2012.
The Korean won has weakened 2.4 percent against the greenback, from W1,183.1 at the end of July to W1,211.2 in late August. When the dollar is on the rise, foreign currency deposits generally dip as people want to sell and make a profit off the difference. But this time, the opposite happened.
"Individual investors are likely buying dollars to diversify their investment portfolio" from plunging stocks, said a BOK official.
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