The convertibility of the Chinese currency, the yuan, and attractive interest rate offered by Chinese lenders has pumped up foreign currency deposits in South Korean domestic banks.
The Bank of Korea reports that deposits in the Chinese yuan reached $16.19 billion in July, up $4.2 billion from June. The bank said more South Korean institutions are investing with Chinese lenders, who are offering better interest rates than available elsewhere.
At the same time, deposits in the greenback, the euro and Japanese yen have all dropped.
