The South Korean won weakened sharply against the US dollar on Wednesday amid lingering Middle East uncertainties and hotter-than-expected US inflation data.
The won opened at 1,493.8 per dollar, down 3.9 won from the prior close. It had plunged 17.5 won to 1,489.9 on Tuesday, its lowest level since April 4.
US consumer prices rose sharply for a second straight month in April, posting the largest annual inflation increase in nearly three years. This raised expectations that the Federal Reserve would hold interest rates steady.
Lack of progress in Washington-Tehran talks kept Middle East tensions high, pushing West Texas Intermediate crude above $102 per barrel. Higher oil prices increased dollar demand for imports in energy-dependent South Korea.
The benchmark KOSPI fell 2.46 percent to 7,447.17 as of 9:30 a.m. Wednesday, weighed down by heavy foreign selling.
