Korean won strengthens against US dollar after authorities' response pledge

Officials work at a dealing room of Hana Bank in Seoul, Tuesday. Yonhap

The Korean currency rose against the U.S. dollar on Tuesday for the first time in seven sessions, supported by foreign stock buying and a pledge by local authorities to take measures to stabilize the foreign exchange market.

The won was quoted at 1,472.4 per dollar as of 3:30 p.m., up 4.7 won from the previous session.

The local currency had fallen for six consecutive sessions through Monday, hitting its weakest level since April 9, when it closed at 1,484.1 won.

The April level was the lowest since March 12, 2009, when the won settled at 1,496.5 per dollar during the global financial crisis.

In response to the recent volatility, the finance ministry, the Bank of Korea (BOK), the National Pension Service (NPS) and the welfare ministry overseeing the pension fund have established a four-way consultation body to discuss ways to balance the NPS' investment returns with stability in the foreign exchange market, and held an inaugural meeting on Monday.

The won's strengthening also came as offshore investors purchased local equities, shrugging off valuation concerns surrounding artificial intelligence (AI) shares amid growing hopes for a U.S. interest rate cut.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 0.3 percent to close at 3,857.78 on Tuesday.