Forex trading volume among South Korean banks fell to the lowest in four years in 2014 as an increase in overseas securities investment reduced foreign exchange transactions among banks, central bank data showed on Monday.
Daily foreign exchange trading among banks, which handle foreign currencies, averaged 44.4 billion U.S. dollars in 2014, down 3.4 percent from a year earlier, according to the Bank of Korea.
It was the lowest since 2010 when the daily average foreign exchange trading amounted to 41.89 billion dollars. After peaking at 46.83 billion dollars in 2011, the trading volume continued to fall to 45.98 billion dollars in 2013.
The 2014 decline came as local residents increased investment in overseas securities, leading to lower foreign exchange holdings by banks and smaller spot transactions among banks.
Daily foreign exchange transactions on spot slid 8.4 percent from a year earlier to 16.65 billion dollars in 2014, with the trading of foreign exchange products falling 0.2 percent to 27.75 billion dollars on the back of lower foreign exchange volatility.
Foreign exchange trading in the inter-bank market decreased 8.2 percent from a year earlier to 20.82 billion dollars in 2014, and those for non-residents slid 1.7 percent to 14.65 billion dollars.
Transaction of foreign currencies between local banks tumbled 9. 6 percent in 2014 from a year earlier, but those between local branches of foreign banks increased 2.5 percent, the central bank said.