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Bloomberg
The Bank of Korea (BOK) will provide $12 billion to banks in its first round of dollar injections using a currency swap line with the Federal Reserve.
The auction will be held on Tuesday at 10 am Seoul time, and banks may apply for seven-days debt of up to $300 million, and 84-days debt of up to $1.5 billion, the central bank said in a statement. The minimum bidding rate will be decided on Monday.
The supply of funds is expected to help stabilise markets, and the central bank will hold more auctions considering the demand for dollars in the market, according to the statement. The $12 billion supplement is expected to be enough to meet market demands for now, the central bank said.
The BOK on March 19 agreed on a $60 billion swap line with the Fed as the spread of the coronavirus and a plunge in oil prices led to a rush for haven and dollars, resulting in a shortage of the greenback and a plunge in the local currency. The central bank last week said it will supply dollars to markets in doses using the swap line with the Fed, with the first round of the injection being substantially larger than the rest.