Bessent says Korean won's depreciation not in line with fundamentals

WASHINGTON, Jan 14 (Reuters) - U.S. Treasury Secretary Scott Bessent said on Wednesday he had discussed the recent depreciation of the Korean won with South Korean Finance Minister Koo Yun-cheol, adding that it was not in line with South Korea's economic fundamentals.

The won KRW= gained sharply on his comments, rising as much as 1.15% to 1,462.0 per dollar, after 10 straight sessions of losses to the weakest level since December 24.

The two discussed critical minerals and ways to strengthen economic ties in a meeting on Monday, the Treasury Department said in a statement.

"Secretary Bessent emphasized that excess volatility in the foreign exchange market is undesirable, and reaffirmed that Korea's strong economic performance, especially in key industries that support America's economy, makes it a critical partner for the United States in Asia," it said.

The recent depreciation of the Korean won was not in line with "Korea's strong economic fundamentals", Bessent said in a post on social media X.

The South Korean finance ministry also said in a text message to reporters they met to discuss foreign exchange market conditions.

Koo vowed earlier in the day to take steps to rein in increasing volatility in the domestic currency market and find ways to resolve an imbalance in dollar demand and supply, in remarks delivered virtually at a discussion forum held in Seoul on foreign exchange policies.

Seoul and Washington finalised in November a trade deal lowering U.S. tariffs on imports from the Asian ally, in return for a $350 billion investment by South Korea in U.S. strategic sectors, after months of negotiations over the foreign exchange implications of the investment package.

Bessent expressed his view at the meeting that the implementation of the trade deal should go smoothly, as he discussed with Koo its "full and faithful" implementation, the Treasury Department said.