The South Korean currency traded near a six-year high against the Japanese yen on Wednesday, raising worries that it could hurt the competitiveness of domestic firms, particularly in the steel, tech and auto sectors.

The local currency rose to the highest it‘s been against the yen on Tuesday since 964.23 won on Aug. 25, 2008. The won pared some of the earlier gains to fall to 971.70 won per 100 yen as of 3:08 p.m., down 2.84 won from Tuesday’s close, on concerns about the currency authorities’ intervention.

The Korean won also dropped 1.7 won to 1,020.00 to the greenback on Wednesday, extending its loss to the second consecutive day.

The won has been gaining against the U.S. dollar, but the yen’s slide to the greenback was much sharper, which makes the South Korean currency appreciate to the Japanese yen.

The yen’s weakness accelerated around the globe for the past few sessions as Japanese Prime Minister Shinzo Abe is set to name a female politician to the government pension fund management who is expected to allow the fund to buy more risky assets.

“The won-yen rate may be maintained at the current level on concerns that the currency authorities may intervene,” said Son Eun-jung, an analyst at Woori Futures.

Earlier in the day, South Korea warned that it is closely watching the foreign exchange market, implying that the won’s rise to the yen is too excessive.

Analysts said the won’s rise to the dollar may be capped as local exporters are expected to sell dollars ahead of the Chuseok fall harvest holiday, which starts on Saturday.

But the yen’s weakness may continue as Japan‘s central bank may take another monetary easing policy in the future, they said. (Yonhap)