By Cynthia Kim and Yena Park
SEOUL (Reuters) – South Korea on Tuesday said it may extend trading hours of the won spot market and allow overseas dealers to participate in the market as it aims for inclusion in the MSCI developed markets index.
The finance ministry said giving out won-trading licenses to offshore dealers is one of the plans being discussed to internationalise the market.
The ministry said it is considering extending trading hours but did provide details on any new trading times.
Currently, onshore trading hours are 00:00 GMT to 06:30 GMT and only locally licensed financial institutions can participate.
The consideration comes as Asia’s fourth-largest economy seeks inclusion on an MSCI watchlist by June, a necessary step before it can be included in the MSCI developed market index.
In 1997, South Korea’s currency system was changed to free-floating from a pegged system. However, the MSCI has long cited the absence of an offshore currency market for the won as an obstacle in promoting South Korea to developed market status.
In offshore hours, the won is mainly traded in the non-deliverable forwards (NDF) markets.
(Reporting by Cynthia Kim; Editing by Leslie Adler and Sam Holmes)
