day Friday as upbeat job data from the United States stoked speculation that the Federal Reserve will raise borrowing costs at a sooner-than-expected date.

The local currency closed at 1,092.7 per dollar, down 0.4 won or 0.04 percent, from the previous session's close, after falling as low as 1,097.20 at one point.

The number of first-time jobless claims over the past four weeks in the world's largest economy fell to an almost 15-year low, strengthening views that the U.S. economy is witnessing a steady improvement in its labor market, according to the data released Thursday by the U.S. Labor Department.

The upbeat data kept the greenback strong against its major peers, raising chances that the Fed may take a step closer toward a much-awaited rate hike.

Also, foreign investors are set to transfer dividends received from local companies to their home countries, putting further downward pressure on the won, dealers said.

"Better-than-expected job data in the U.S. and foreign investors' dividend transfers will work to boost the won-dollar rate," said Sun Seong-in, an analyst at Shinhan Investment Corp.

But the won's loss was limited on news that Moody's Investors Service Inc., a global rating agency, raised its credit outlook for South Korea to positive from stable, citing improved debt management, lower vulnerability to global financial market shocks and a track record of fiscal prudence.

Dealers said the won may come under further selling pressure as South Korea's central bank cut its economic forecasts, leaving room for an additional rate reduction.

On Thursday, the Bank of Korea held its base rate steady at a record low of 1.75 percent, while cutting its growth estimate for Asia's fourth-largest economy to 3.1 percent from an earlier 3.4 percent forecast.

But the rate decision was not unanimous, with one member of the central bank's rate-setting committee calling for a rate cut, fueling speculation that the central bank may become further dovish when the economy is not on a course toward a firm recovery as is expected.

"A dissenting vote in favor of a rate cut points to the possibility of easier policy ahead," said Mark Walton, an economist at BNP Baribas.

Meanwhile, in its semi-annual report on foreign exchange policies around the globe, the U.S. Treasury slammed South Korea's currency intervention, but South Korea's currency authorities denied it, saying that Seoul only engages in smoothing operations to counter volatility. (Yonhap)