The South Korean won slid today after North Korean leader Kim Jong Il died, leading to fears that North Korea would face a political turmoil that may negatively influence South Korea.
One of the leader’s sons is going to succeed Kim Jong Il. Some market participants hope that a new leader would set the country on a more “reasonable” course. On the other hand, the previous years brought a degree of stability to the relationship of Koreas, even though it was often threatened by provocations and quarrels. Investors fear that a relatively peaceful period may end as a transition of power is often followed by a political turmoil in a country, and that turmoil may lead to worsening relationship between the Asian countries.
USD/KRW advanced from 1,176.4000 to 1,174.1000 as of 16:28 GMT today.
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