Liquidity has tended to fall during late night hours, and given the shock, some impact was probably inevitable, said Kim Hee Jae, director of the finance ministry’s currency market division.
South Korea is planning measures to boost after-hours liquidity in the won, after this week’s political crisis triggered a surge in volatility in the currency.
When South Korean President Yoon Suk Yeol late Tuesday night shocked the country by briefly imposing martial law, the gap between bid and offer prices in the spot market widened to as much as KRW16 (1.5 cents) and remained elevated through the night, according to data compiled by Bloomberg. That compared to about KRW2.5 for the non-deliverable forward market, another venue for betting on Korea’s currency.
