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South Korea won rises as Dubai debt worries ease

Published: 29 Nov 2009 23:59:00 PST

* Seen volatile as investors remain jittery

* Eyes on Nov trade data; exports seen up 21 pct (Updates to domestic close)

SEOUL, Nov 30 - The South Korean won rose over 1 percent against the dollar on Monday, helped by eased worries about Dubai's debt crisis after the United Arab Emirates (UAE) offered emergency help to banks there.

Local shares jumped more than 2 percent and exporters chased the won <KRW=>, prompting investors to clear dollar-long positions.

The local currency is expected to remain volatile as the Dubai situation will continue to fuel jitters despite the UAE's response, analysts said.

"I don't think the Dubai problems will hurt the won's long term bullish trend. But the issue will definitely boost volatility in the market," said Jeong My-young, a currency strategist at Samsung Futures Inc.

The South Korean unit was quoted at 1,162.4/3.0 per dollar as of 0600 GMT, compared with Friday's domestic close <KRW=KFTC> of 1,175.5.

The UAE central bank offered emergency support on Sunday to ease concerns that a looming debt default by two Dubai's flagship firms could derail the global economic recovery. [ID:nGEE5AS0AH]

South Korean Vice Finance Minister Hur Kyung-wook also said the government would stay vigilant to deal with anticipated market instability from Dubai's debt crisis. [ID:nSEO39078]

Seoul shares <.KS11> ended up 2.04 percent as foreign investors bought a net 127.4 billion won worth of stocks on the main exchange.

Investors are keeping an eye on November trade data due on Tuesday. Exports in November probably rose 20.9 percent from a year ago, the first annual rise in 13 months, a Reuters poll showed. [ID:ID:nSP280898]

Earlier, the government said overseas sales in 2010 would grow 12.9 percent after a projected 13.9 percent loss this year, which would be the worst since 1958. [ID:nSEO43249]

0600 GMT 0005 GMT Prev close Won 1,162.4/3.0 1,164.6/5.1 1,175.5 Yen/won 13.4787/872 13.4383/460 13.6400/711 KOSPI 1,555.60 1,550.31 1,524.50 (Editing by Jonathan Hopfner) ((jongwoo.cheon@thomsonreuters.com; +82 2 3704 5665; Reuters Messaging;jongwoo.cheon.reuters.com@reuters.net)) (