"Middle East Risk Persists... Won to Remain in Mid-1300s Range"
Following verbal intervention remarks by finance ministers of major countries, the won-dollar exchange rate, which recently surged to 1,400 won, closed lower in the 1,370 won range.
On the 18th at the Seoul foreign exchange market, the won-dollar exchange rate opened at 1,380 won, down 6.8 won from the previous day, fluctuated in the 1,370 won range during the session, and closed at 1,372.9 won, down 13.9 won from the previous day's closing price.
The won-dollar exchange rate touched 1,400 won intraday on the 16th. The last time it rose to 1,400 won intraday was about 1 year and 5 months ago on November 7, 2022 (1,413.50 won). In response, the foreign exchange authorities actively engaged in verbal intervention that day.
In the early hours of the 18th, finance ministers of the Group of Seven (G7) met and indicated through a joint statement that they could take appropriate measures to respond to the sharp volatility in the foreign exchange market. On the same day, during the trilateral finance ministers' meeting of Korea, the United States, and Japan, a statement was released acknowledging "serious concerns over the recent sharp depreciation of the won and the yen."
Choi Ye-chan, a researcher at Sangsangin Securities, explained, "There had been a strong tendency to bet on won weakness, but the verbal intervention hinted at by the authorities and the finance ministers of Korea and Japan weakened this tendency."
Park Sang-hyun, a research fellow at Hi Investment & Securities, said, "The stock and bond markets showed generally stable trends that day, which also influenced the exchange rate," but added, "Since Middle East risks still remain, the won-dollar exchange rate should keep the possibility open for the 1,350 to 1,380 won range going forward."
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