South Korea’s foreign exchange market will move to round-the-clock won-dollar trading from July, marking a major step in efforts to improve market accessibility.
Seoul authorities approved revisions to the code of conduct for the onshore forex market at a meeting held Friday, the Finance Ministry announced through a statement released Sunday. The change will take effect from July 6.
Under the revised code, won-dollar trading hours, currently set from 9 a.m. to 2 a.m. the following day, will be extended to run continuously from 6 a.m. Monday to 6 a.m. Saturday during New York daylight saving time.
During periods when daylight saving time is not in effect, trading will operate from 7 a.m. Monday to 7 a.m. Saturday. Daylight saving time in New York runs from March 8 to Nov. 1 this year.
While trading will be available on public holidays, settlement will continue only on bank business days in line with prevailing market practice.
Limited trading hours have long been viewed as one of the key hurdles to Korea upgrading to a developed market from the global index provider Morgan Stanley Capital International. Korea currently remains on the emerging market index.
“Extended trading hours are expected to improve market accessibility, while enhancing convenience for domestic and overseas investors, exporters and importers and lowering transaction costs,” the authorities said.
Trading hours in currencies other than the dollar will remain unchanged from 9 a.m. to 3:30 p.m.
The benchmark closing rate will continue to be set at 3:30 p.m. at the close of daytime trading.
The authorities plan to revise the Foreign Exchange Transactions Regulations in June.
silverstar@heraldcorp.com
