Won-Dollar Exchange Rate Hits 1467.8 Won... Largest Increase in 5 Years

Korean Won-Dollar Exchange Rate Hits 1,467.8 Won
Won-Yen Recalculated Rate Reaches 1,008.21 Won

The value of the Korean won plummeted due to the impact of U.S. President Donald Trump's tariff announcement.

On the 7th, dealers are working in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. Photo by Yonhap News

On the 7th, the weekly closing exchange rate of the Korean won against the U.S. dollar in the Seoul foreign exchange market (as of 3:30 PM) recorded 1,467.8 won, up 33.7 won from the previous trading day. This is the largest increase in about five years since March 19, 2020 (40.0 won), during the early stages of the COVID-19 pandemic.

The exchange rate opened at 1,462.0 won, 32.9 won higher than the previous day, and at one point rose to 1,471.6 won. However, it did not climb further and narrowed the increase, falling to around 1,461 won by about 2:30 PM. It then rebounded again and closed the weekly session in the high 1,460 won range. The dollar index, which shows the value of the dollar against the currencies of six major countries, rose 0.64% from the previous day to 102.546.

The sharp drop in the exchange rate on this day is interpreted as a result of growing concerns about a global economic slowdown due to the U.S. mutual tariffs and retaliatory tariffs announced by pro-China parties, which intensified risk-averse sentiment toward risky assets.

While major Asian stock indices such as Japan and Taiwan fell sharply, both the KOSPI and KOSDAQ indices in the domestic stock market dropped by more than 5%.

The value of the Japanese yen, classified as a safe-haven asset along with the U.S. dollar, surged. The won-yen exchange rate surpassed 1,000 won, reaching the highest level in three years. As of 3:30 PM on the day, the won-yen recalculated exchange rate was 1,008.21 won per 100 yen, up 26.39 won from the previous day's 3:30 PM rate. This exceeded 1,000 won for the first time in about two years since April 27, 2023 (1,000.26 won), and marked the highest level in about three years since March 22, 2022 (1,011.75 won). At the same time, the yen-dollar exchange rate fell 0.31% to 145.576 yen.