The Korean government said it is set to minimize fluctuations in the country's foreign exchange market through deeper intervention. The Ministry of Strategy and Finance, the Bank of Korea, and the Financial Supervisory Service are said to have established a task force to achieve this goal.

A government official with the country's financial watchdog reportedly said that aside from a massive sell-off of Korean shares by foreign investors amid the global economic crisis, remittals of foreign currency from non-Korean banks in Korea to their headquarters has been a major factor in worsening conditions in the country's financial markets.

The government said it plans to continue to stabilize the won-dollar exchange rate by smoothing operations or policy fine-tuning, and at the same time intends to strengthen regulations in the market through the newly-created task force to develop more fundamental solutions.

Such regulations include limiting the amount of loans made in foreign currencies by non-Korean banks, and setting a cap on the foreign liabilities of public firms and domestic banks.