Volatile Won-Dollar Exchange Rate Amid Impeachment Turmoil... Closing Near 1420 Won Threshold (Comprehensive)

As the impeachment political situation rapidly unfolded, the won-dollar exchange rate opened in the 1410 won range on the morning of the 6th, soaring to the threshold of 1430 won before experiencing sharp fluctuations. However, due to market stabilization measures by the foreign exchange authorities, it closed in the late 1410 won range during weekly trading.

Yonhap News

On that day in the Seoul foreign exchange market, the won-dollar exchange rate closed at 1419.2 won in weekly trading, up 4.1 won compared to the previous trading day's closing price at 3:30 PM. The won-dollar exchange rate opened at 1416.0 won, 0.9 won higher than the previous day, and surged to the 1429 won range around 10:50 AM. Afterwards, a strong volume of dollar sales, presumed to be direct intervention by the foreign exchange authorities, brought it down to the late 1410 won range.

This sharp rise in the exchange rate is interpreted as a result of the won facing depreciation pressure amid growing domestic political instability following the recent emergency martial law situation and the deepening impeachment political crisis. On the morning of the same day, Han Dong-hoon, the leader of the People Power Party, expressed agreement with impeachment at an emergency supreme council meeting held at the National Assembly, stating, "I judge that a prompt suspension of President Yoon Seok-yeol's duties is necessary to protect the Republic of Korea and its people."

Furthermore, the possibility of a second emergency martial law declaration was mentioned during the morning, increasing pressure on the exchange rate to rise. However, the exchange rate stabilized again after the Ministry of National Defense and the Joint Chiefs of Staff stated in a press briefing that "there is no need to worry about a second martial law."

For the time being, the exchange rate is expected to maintain a high level amid the unstable political situation. Min Kyung-won, a researcher at Woori Bank, evaluated, "Ultimately, the key is how quickly the impeachment proceeds. If political uncertainty is resolved, the exchange rate will plummet, but if it is delayed more than expected, a high exchange rate will be maintained for the time being."