U.S. dollar-denominated assets are gaining more popularity in the local market amid signs that the Washington-based Federal Reserve will raise the base rate at its Dec. 15-16 meeting.

In contrast, investors’ interest in Korean won-denominated assets appears to be waning as shown by the recent trading of local stocks by foreigners. Both local and foreign investors are betting on the dollar’s sharp gains against the won.

On a collective basis, four commercial banks saw individuals’ dollar-denominated deposits surged by 20.5 percent, or $715 million, in a month ― from $3.47 billion on Sept. 30 to $4.18 billion as of Oct. 31.

While the interest rate offered by the four first-tier banks ― KB Kookmin, Woori, IBK and NH Nonghyup ― is around 1 percent per annum, depositors are aiming at forex gains, which are not taxed.

The greenback’s popularity among individuals is also seen at Shinhan Bank and KEB Hana Bank, both of which calculate several foreign currency-denominated deposits together.

“Their active investment in dollar assets started in 2013 when the Fed hinted at tapering its quantitative-easing policy,” a bank spokesman said.

He added the dollar deposits have drawn more attention in recent weeks after the October minutes of the Federal Open Market Committee hinted at the possibility of a rate hike in December.

Some analysts, however, cite the unexpected events in November ― terror attacks in Paris and global retaliation against Islamic State ― could stand in the way of a rate hike next month.

In the Korean financial market, foreign investors have been on a selling streak since early this month. They posted net-selling in nine out of the last 10 trading sessions since Nov. 10 on the main bourse.

According to the Korea Exchange, they net sold local stocks worth 103.8 billion won ($112.9 million) Monday, and their net-selling over the past month came to 1.08 trillion won.

The dollar rose by 0.36 percent, or 4.2 won, from a session earlier to finish at 1,158.5 won Monday.

It hovered in the range of 1,128 to 1,144 won between late October and early November.

By Kim Yon-se (kys@heraldcorp.com)