Won Falls Amid Brexit Fallout as Investors Shun Riskier Assets

(Bloomberg) -- The won fell for a third day on Wednesday in its longest losing streak in 10 weeks, as worries over the potential impact of the U.K.'s exit from the European Union on global economic growth damped appetite for riskier assets, sending Asian stocks lower.

The South Korean currency slid as the Kospi index of shares retreated, with foreign investors turning net sellers of local stocks after five sessions of buying.

“The market's focus is back on post-Brexit uncertainty, and this is negative for riskier assets like the won,” said Suh Daeil, an economist at Mirae Asset Daewoo Co. in Seoul. “Investors are growing more concerned about how it could potentially impact corporate investments and the global economy,” he said.

The won fell 0.9 percent to 1,165.65 per dollar as of the 3 p.m. close in Seoul, according to prices from local banks compiled by Bloomberg. It climbed 3 percent last week, the most since 2011, recouping all its losses from the U.K. vote to leave Europe's trading bloc.

The currency was the worst performer in Asia Wednesday. The Kospi fell 1.9 percent, declining for a second straight session, while the MSCI Emerging Market Index dropped 1.2 percent.

South Korean government bonds rose as investors sought out safer bets among local assets. The yield on three-year notes fell one basis points to a record closing low of 1.207 percent, Korea Exchange prices show. The yield for 10-year bonds dropped three basis points to 1.39 percent after hitting an unprecedented 1.367 percent.

To contact the reporter on this story: Jung Park in Seoul at jpark710@bloomberg.net. To contact the editors responsible for this story: Naoto Hosoda at nhosoda@bloomberg.net, Jonathan Annells