South Korea’s won led declines in Asian currencies amid concern the yen’s slump will trigger a currency war, and after the European Central Bank said the euro’s strength could hamper an economic recovery. The won slid the most in a week after the yen plunged to the weakest level since May 2010. Thailand’s baht traded at the lowest level this month, while the Taiwan dollar fell for a fourth day. ECB President Mario Draghi said yesterday economic growth may slow after the euro strengthened against the dollar in January. A Bank of Japan board member said this week the monetary authority will need new initiatives to attain its goal of boosting inflation to 2 percent. “It’s a risk-off situation as we can expect more verbal warning about the yen-Asia crosses given recent statements in Japan,� said Wong Chee Seng, a currency strategist in Kuala Lumpur at Ambank Group. “Concerns about the euro’s strength and debt issues in major economies are also back on the radar.� The won declined 0.5 percent to 1,093.240 per dollar as of 11:17 a.m. in Seoul, according to data compiled by Bloomberg. The baht lost 0.1 percent to 29.79 and the Philippine peso fell 0.1 percent to 40.663. The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding the yen, dropped for a third week. Thai Letter Foreign funds pulled 1.9 trillion won ($1.7 billion) from South Korea’s stock market in January, the government said on Feb. 5, on concern the won’s 17 percent gain versus the yen in the past three months will erode profits at companies like Samsung Electronics Co. The government is “all ready� to curb won volatility, Finance Minister Bahk Jae-Wan said Jan. 23. The baht fell the most this month on speculation the central bank will intervene after the currency reached a 17- month high of 29.66 on Jan. 21. Finance Minister Kittiratt Na- Ranong said this week that he wrote to the Bank of Thailand urging an interest-rate cut to deter capital inflows. “The currency retreated amid concern that the authorities in countries with high dependence on exports may take actions to slow gains,� said Tohru Nishihama, an economist at Dai-ichi Life Research Institute Inc. in Tokyo. One-month Taiwan’s dollar forwards declined 0.2 percent to NT$29.66 per dollar. The central bank said it will monitor the currency market for disorderly movements, according to a statement on its website. China’s yuan advanced as much as 0.14 percent to 6.2232 per dollar, according to China Foreign Exchange Trade System, the biggest advance since Jan. 11. The People’s Bank of China strengthened its central parity rate at today’s fixing by 0.17 percent, the most since Oct. 15, before the market closes from Feb. 11 for a weeklong Lunar New Year holiday. Elsewhere, Malaysia’s ringgit was steady at 3.0959 per dollar and Indonesia’s rupiah gained 0.1 percent to 9,685. India’s rupee traded at 53.205 yesterday, little changed from a week ago. To contact the reporter on this story: David Yong in Singapore at dyong@bloomberg.net To contact the editor responsible for this story: Amit Prakash at aprakash1@bloomberg.net

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