[Yoon Seok-yeol Impeachment] Dollar-Won Exchange Rate Falls to 1430 Won Range...Gaining Attention Overseas

Dropped to the Low 1,430 Won Range, Then Rebounded
Maybank Malaysia: "Trust Issues Eased"

The Constitutional Court's order to impeach President Yoon Suk-yeol is expected to have a positive impact on the Korean economy, leading the USD-KRW exchange rate to converge in the high 1430 won range.

According to Bloomberg, as of 1:51 PM on the 4th (Korean time), the USD-KRW exchange rate stood at 1,436.97 won, down 14.02 won from the previous day's weekly closing price of 1,451.0 won. The USD-KRW rate fell to 1,430.6 won at 11:10 AM during the impeachment order proceedings, then rebounded to touch the 1,440 won level immediately after the ruling, before settling back into the 1,430 won range. A decline in the exchange rate generally indicates a strengthening of the Korean won.

The Constitutional Court's decision to accept President Yoon Suk-yeol's impeachment is interpreted as alleviating some political uncertainty, which has driven the won's appreciation.

Sean Lim, a foreign exchange strategist at Maybank, a Malaysian bank, analyzed, "The fact that it took quite a long time for the Constitutional Court to issue a ruling on the December martial law has been weighing down the won. It seems that trust issues will ease."

Kim Byung-yeon, a researcher at NH Investment & Securities, diagnosed in a report on the same day that the USD-KRW exchange rate will stabilize downward in the low 1400 won range due to the Constitutional Court's acceptance of the presidential impeachment. He noted, "The possibility of a credit event has diminished due to increased expectations for policy support," adding, "The key point to watch going forward is the size of the supplementary budget." He also predicted that if the supplementary budget exceeds 20 trillion won, the economic stimulus momentum will expand and long-term Korean interest rates will rise.