The won-dollar exchange rate closed higher at 1,467 won amid political instability.
According to the Seoul foreign exchange market on the 24th, the weekly closing price of the won-dollar exchange rate (as of 3:30 p.m.) recorded 1,467.7 won, up 5.0 won from the previous trading day. The exchange rate has risen for the fifth consecutive day since the 18th (+5.0 won; 1,452.90 won).
The exchange rate opened at 1,463 won, up 0.3 won from the previous trading day, and exhibited a stable trend at the beginning of the session while waiting for the impeachment ruling of Acting Prime Minister Han Duck-soo. However, after the impeachment was dismissed, it surged to 1,469.1 won at 11:02 a.m. It then decreased to the upper 1,460s as concerns about intervention by foreign exchange authorities increased.
The Constitutional Court held the ruling date for the impeachment of Prime Minister Han at 10 a.m. and dismissed the National Assembly's impeachment motion. Among the eight judges, five expressed opinions for dismissal, one for acceptance, and two for rejection. The National Assembly claimed that Prime Minister Han colluded with President Yoon Suk-yeol in the declaration of martial law on Dec. 3, but this was not accepted.
Foreign investors accelerated the rise in the exchange rate by selling stocks in the domestic market. Foreigners posted a net purchase of 6 billion won in the KOSPI market but a net sale of 30 billion won in the KOSDAQ market. It seems that foreign investors' sentiment has been depressed due to political instability.
Fortunately, the dollar showed weakness, which limited the rise in the exchange rate. According to Investing.com, the dollar index (DXY), which shows the value of the dollar against six major currencies, recorded 103.6 as of 5:56 p.m. It hit the 104 range during trading but fell.
Park Sang-hyun, a researcher at iM Securities, noted that "the deepening political uncertainty and the weakening of economic fundamentals are exacerbating the depreciation of the won," adding that "the recent series of bankruptcies among construction firms has raised credit risks for corporations."