The Gulf Time Newspaper One of the finest business newspapers in the UAE brought to you by our professional writers and editors.
BLOOMBERG
The South Korean won, Asia’s worst-performing currency this quarter, will soon have a new item added to its long list of troubles — the dividend payment season in April.
This month normally sees overseas investors take dividends out of the country. Expected handouts to foreign investors at the top 10 Korean companies with the largest dividends allotted to global funds are at least 4.59 trillion won ($3.53 billion), according to Bloomberg’s calculations based on company filings and data from the Korea Exchange.
The conversion of these dividends into foreign currencies is set to weigh on the won, which is already reeling from a slump in demand for semi-conductors and smartphones, heavily affecting the nation’s exports and growth rate. Banking sector instability and geopolitical tensions on the Korean Peninsula have also exposed it to sudden changes in risk appetite.
The dollar-won bounced off support from its 50-day moving average in March and bullishly snapped its two-week losing streak in an ominous sign for the currency.