US Interest Rate Cut Hinted... Won-Dollar Exchange Rate Closes Down 24.5 Won

Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), is holding a press conference on the 13th (local time) in Washington DC after concluding the Federal Open Market Committee (FOMC) regular meeting.
[Image source=Yonhap News]

The won-dollar exchange rate fell by more than 20 won as expectations for a rate cut by the U.S. Federal Reserve (Fed) grew.

On the 14th, in the Seoul foreign exchange market, the won-dollar exchange rate closed at 1,295.4 won, down 24.5 won from the previous day.

On that day, the won-dollar exchange rate started trading at 1,296.0 won, down 23.9 won from the previous day, and fluctuated around the 1,290 won level.

This was due to the dollar weakening amid the Fed's dovish (preference for monetary easing) stance.

Earlier, on the 13th (local time), the Fed indicated at its last Federal Open Market Committee (FOMC) regular meeting of the year that there would be no further tightening policies while keeping the benchmark interest rate unchanged.

In particular, the Fed forecasted the benchmark interest rate at the end of next year to be 4.6% (median), which is 0.65 to 0.90 percentage points lower than the current rate. This led to market expectations that the Fed would cut rates three times by 0.25 percentage points each next year.

Fed Chair Jerome Powell also supported this outlook during a press conference, stating, "We discussed the timing of rate cuts with the committee members. The members' view is that further rate hikes are not appropriate."