FX forward net buying by Korean firms soars in 2014

South Korean companies saw their forward exchange net purchases increase in 2014 from a year earlier as the won strengthened against the U.S. dollar in the first half of the year, central bank data showed Tuesday.

The net purchases reached $10 billion last year, sharply increasing from $1.6 billion in 2013, according to the data from the Bank of Korea. The amount is smaller than the $24.1 billion posted in 2012.

The on-year rise was attributed to a fall in forward selling in the first half as shipbuilders and heavy industries firms slimmed down their forward selling amid a strengthening won.

Overall, the won depreciated 4 percent against the greenback last year, reversing from a 1.4 percent rise in 2013. The local currency gained 9.7 percent in the cited period, slowing from a 23.6 percent appreciation a year earlier.

The won strengthened to a yearly high of 1,008.5 won against the U.S. dollar on July 3, but weakened to 1,099.3 won on Dec. 30 on growing hopes that the U.S. Federal Reserve would move to normalize rates. (Yonhap)