South Korea's central bank suspends dollar auction from Fed swap on stabilising forex market –

South Korea’s central bank said on Wednesday it is suspending auctions of U.S. dollars from the currency swap deal with the Federal Reserve as market conditions had begun to stabilise amid the gradual easing of coronavirus lockdowns globally.

“The Bank of Korea will suspend auctions for some time, while monitoring market conditions, as the FX liquidity situation seems sound, given continued decline in LIBOR interest rates, rising swap rates and foreign currency deposits,” it said in a statement.

The bank’s auction of dollar drew a total $19.872 billion versus $36.5 billion offered through six separate auctions.

In mid-March, the BOK said it signed a bilateral $60 billion currency swap arrangement with the Fed for at least six months, and pledged to inject dollar liquidity immediately to onshore markets to stabilise the currency market.

(Reporting by Joori Roh; Editing by Shri Navaratnam)

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