The South Korean won fell 2.4 percent against the dollar on Wednesday as rekindled concerns over an economic slowdown dampened local shares, with foreign investors returning to net sellers in the stock market. The local currency pared early losses as some traders spotted dollar-selling by the foreign exchange authorities and on a media report that the government provided additional dollars to local exporters to ease their dollar shortages.
The won was quoted at 1,238.0/9.6 per dollar as of 0600 GMT, compared with Tuesday's domestic close of 1,208. It slid to as low as 1,256.5. Finance Minister Kang Man-soo was quoted as saying that Asia's fourth-largest economy would struggle to grow 4 percent this year in the face of the global financial crisis, giving weight to the earlier falls of up to 3.9 percent.
Echoing the remarks, Deputy Finance Minister Noh Dae-lae said the economy was expected to have grown 4.3 percent from a year ago in the third quarter and growth was likely to shrink further in the fourth quarter. The ministry's forecast in July for 2008 growth was 4.7 percent, compared with actual growth of 5.0 percent last year.