Despite Verbal Intervention by Authorities, Unstable Exchange Rate... Trading at 1408 Won Level (Update)

Despite verbal interventions by foreign exchange authorities warning of a sharp rise in the won-dollar exchange rate, the exchange rate continues to increase, showing instability in the foreign exchange market.

On the 14th, in the Seoul foreign exchange market, the won-dollar exchange rate opened at 1,403.6 won, down 3.0 won from the previous trading day.

As the exchange rate recently surged, surpassing the 1,410 won level during the previous day’s session, the foreign exchange authorities conducted verbal intervention on the same day.

Choi Sang-mok, Deputy Prime Minister and Minister of Strategy and Finance, said at an "Emergency Macroeconomic and Financial Issues Meeting" held at the Seoul Banking Hall in the morning, "Uncertainties remain regarding the policy direction of the new U.S. administration, global economic growth and inflation trends, and major countries’ monetary policy stances," adding, "We will closely monitor market conditions with heightened vigilance through a 24-hour joint inspection system among related agencies."

He continued, "While ensuring thorough cooperation and response systems according to contingency plans, I urge related agencies to promptly implement active market stabilization measures if financial and foreign exchange market volatility expands excessively."

This verbal intervention by the foreign exchange authorities is the first in seven months since mid-April. Despite the authorities’ verbal intervention, the exchange rate reversed to an upward trend, rising to the 1,408 won level as of 11:12 a.m.

This is interpreted as a continuation of the dollar’s strength due to concerns over trade conflicts following the inauguration of Donald Trump’s second administration. The dollar index, which indicates the value of the dollar against the currencies of six major countries, is trading at 106.59, up 0.47% from the previous day, near its highest level of the year.