Won-Dollar Exchange Rate Falls Back to 1,420 Level... Driven by Profit-Taking and Stronger Yuan

The won-dollar exchange rate fell to the 1,420 won level for the first time in five trading days, influenced by month-end profit-taking demand and the strengthening of the yuan.

Yonhap News

In the Seoul foreign exchange market, the won-dollar exchange rate closed weekly trading at 1,421.0 won, down 16.3 won from the previous trading day's weekly closing price (as of 3:30 p.m.). The rate opened at 1,433.4 won, down 3.9 won from the previous day, and continued to decline, dropping to as low as 1,420.8 won in the afternoon session.

Following last week's rebound in the won-dollar exchange rate, the decline on this day was driven by investors realizing profits or adjusting positions at the end of the month. The strengthening of the yuan against the dollar also exerted downward pressure on the exchange rate. The offshore yuan-dollar exchange rate closed weekly trading at 7.2602 yuan, down 0.13% from the previous trading day.

However, caution remains ahead of the release of the U.S. first-quarter gross domestic product (GDP) and the March personal consumption expenditures (PCE) price index. Wi Jaehyun, an economist at NH Futures, analyzed, "Exporters' month-end settlement volumes created downward pressure," adding, "This was due to both month-end volumes and pre-holiday volumes ahead of the May holidays being released in advance."