Closing price at 1437.0 KRW on the afternoon of the 9th
Surged up to 1438.8 KRW at one point
"Unstable trend expected to continue for a while"
The exchange rate, which had been gradually stabilizing, has surged again following the 12·3 emergency martial law incident, deepening citizens' concerns. Experts predict that this unstable trend will continue for the time being, attributing it to a combination of worsening external conditions and domestic political situations.
Amid rising exchange rates such as the won-dollar rate following the martial law situation, the won-dollar buying rate at a private exchange office in Myeongdong, Seoul, was displayed as 1,420 won on the 10th. Photo by Heo Young-han
According to related industries on the 10th, international students, long-term overseas residents, and overseas business operators are struggling with tuition and living expenses as the won-dollar exchange rate soars. Choi In-seon (53), a parent who sent two children to study in the United States, said, "The next tuition payment for my eldest is in the last week of December, and for my second child, it is the first week of January next year. At the current exchange rate, it costs a total of 105 million won. Compared to a month ago, it has increased by exactly 12 million won." She added, "I only feel despair and helplessness. I am considering asking the school to postpone the tuition payment, hoping the situation will improve over time."
Kim (25), who is pursuing a master's degree at a private university in the United States, said, "The tuition payment deadline for the spring semester is approaching soon, but the exchange rate has risen so much that I feel ashamed to tell my parents who are paying for my tuition." He added, "Next semester, I plan to find a part-time job to reduce the allowance I receive from my parents, even if just a little."
Export-import business operators sensitive to exchange rates are also facing red flags. Park Han-gi (47), who runs a cosmetics import company, said, "We had contracts to import goods in bulk ahead of the year-end and New Year’s peak season. Now, as the payment deadline to our suppliers approaches, the exchange rate has suddenly risen so much that it seems I am losing nearly 20 million won." He added, "Not only me, but all distribution workers doing business with overseas suppliers around me must be feeling the same way."
According to the Seoul Foreign Exchange Market, on the 9th, the won-dollar exchange rate closed at 1,437.0 won, up 17.8 won from the previous trading day's afternoon closing price of 1,419.2 won. At one point, the high price surged to 1,438.3 won, threatening the 1,440 won level. The won-dollar exchange rate had surged more than 40 won within an hour after President Yoon Seok-yeol declared martial law on the 3rd, but after news of the National Assembly lifting the martial law was heard, the afternoon closing price on the 4th fell back to the 1,410.1 won level, seeming to stabilize gradually. However, due to the rejection of President Yoon’s impeachment motion and rumors of a second martial law, it rapidly rose from the 5th and reached its highest point in 2 years and 2 months on the 9th.
Experts foresee that this trend will continue until the impeachment political situation is resolved. Jeong Se-eun, a professor of economics at Chungnam National University, said, "The exchange rate is soaring due to the election of President Trump, worsening domestic and international trade environments, and increasing domestic political uncertainty. It should be seen as a reflection of the impeachment political situation rather than a significant change in South Korea’s macroeconomic indicators." He added, "There was a prediction last week that the impeachment motion would pass smoothly and the political situation would stabilize, but its rejection prolonged the uncertain situation. I think this trend will continue until the impeachment political situation is resolved."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
