Won-Dollar Exchange Rate Breaks Above 1,550 Won, Highest Level in 17 Years
Won-dollar exchange rate breaks above 1,550 won, background and outlook for the highest point in 17 years Check the causes, including dollar strength and foreign selling, as well as the possibility of a decline by year-end
The wondollar exchange rate closed at 1,554.9 won in the Seoul foreign exchange market on the 1st, surpassing the 1,550 won range. Based on weekly closing prices, this is the first time in 17 years since March 2009, during the global financial crisis.
This rise is analyzed to have been influenced by several factors together, including dollar strength amid expectations of a possible rate hike by the U.S. Federal Reserve, foreigners' net selling of domestic stocks, reverse remittance demand tied to firsthalf settlement, and a weaker yen.
Foreign exchange authorities stepped in to defend the exchange rate by injecting about $13.6 billion in the first quarter of this year, but they were unable to stop the upward trend. In the market, there is talk of further shortterm gains, but some also predict that by the end of the year it could come back down depending on foreign capital flows and changes in external conditions.