SEOUL (Reuters) -South Korean President Yoon Suk-yeol and his U.S. counterpart, Joe Biden, are expected to discuss a currency swap, the Yonhap news agency said on Friday, quoting a senior official of Yoon’s office.
A re-establishment of a currency swap with the U.S. would be a way of countering the won’s persistent decline against the dollar, amounting to about 17% this year, to make it Asia’s worst performing currency, except for the Japanese yen.
Washington and Seoul officials are arranging a meeting of the leaders on the sidelines of next week’s U.N. General Assembly meeting in New York.
A $60-billion currency swap pact set up in March 2020 by South Korea’s central bank and the U.S. Federal Reserve, as an emergency step to stabilise markets, expired at the end of last year.
Such a swap would allow South Korea to borrow a certain amount of U.S. dollars for a pre-set period and rate, in exchange for won, so as to resolve difficulties in dollar liquidity.
(Reporting by Cynthia Kim, Soo-hyang Choi; Editing by Clarence Fernandez)
