South Korean regulators will inspect speculative won trading and require banks to strengthen risk management

The Financial Supervisory Service of South Korea stated that the tense situation in the Middle East and market expectations for interest rate hikes by the Federal Reserve are driving fluctuations in the Korean won exchange rate. The Financial Supervisory Service has requested banks to strengthen risk management measures to cope with market turmoil.

In addition, the Financial Supervisory Service and the Bank of Korea will conduct inspections on speculative Korean won trading. The Financial Supervisory Service emphasized that excessive volatility in the foreign exchange market and unilateral positions are undesirable, and stated that the fundamentals of the South Korean economy and external credibility remain solid.