On the 9th, the won-dollar exchange rate rose to the 1400 won range after two days. The U.S. dollar showed strength as signs emerged that the tariff war initiated by the Trump administration was easing. The won-dollar exchange rate had to give up the 1300 won range that it had difficultly regained after six months.
On that day in the Seoul foreign exchange market, the won-dollar exchange rate closed at 1400.0 won, up 3.4 won from the previous day based on weekly transactions. The won-dollar exchange rate had logged a consecutive decline over the previous five trading days, recording the 1300 won range on the 7th and 8th. This was the first time in six months since Nov. 29 of last year.
However, this level of the exchange rate did not last long. That day, the won-dollar exchange rate started at 1404.8 won, up 8.2 won from the previous day, and quickly surpassed 1400 won right after opening. In the afternoon, it dropped to the 1390 won range but rose right before the market closed, ultimately finishing at 1400.0 won.
The previous day (local time), news that U.S. President Donald Trump had reached a trade agreement with the United Kingdom was a factor pushing up the won-dollar exchange rate. Under the agreement, the U.S. agreed to partially reduce tariffs on British steel, aluminum, and automobiles. In return, the U.K. agreed to promote the import of U.S. products such as beef, poultry, ethanol, soft drinks, and cereals.
This trade agreement marks the first deal since President Trump announced last month that he would impose reciprocal tariffs on countries worldwide. It is interpreted that the value of the U.S. dollar has risen as the tariff negotiations have not escalated to extremes.
Local media reported that President Trump might lower tariffs on China from 145% to around 50%. The New York Post stated, "The Trump administration is considering a proposal to lower the tariffs imposed on China following the inauguration to a range of 50% to 54%."
Additionally, the Federal Open Market Committee (FOMC) meeting on the 7th deemed economic indicators to be stable, which is also analyzed as a factor for the dollar's strength. Kim Chan-hee, a researcher at Shinhan Investment Corp., noted, "Jerome Powell, chair of the U.S. Federal Reserve, indicated that he would maintain a data-dependent policy stance in response to current uncertainties," adding, "Statements that the economy is still performing well have acted as a factor for the strength of the dollar."
In fact, the FOMC stated in its announcement, "The unemployment rate has stabilized at a low level over the past few months, and conditions in the labor market remain robust." Chair Powell also remarked, "If we remove the distorted figures of the first quarter growth rate (temporary increase in revenue due to tariffs), the economy still shows solid growth."
According to Investing.com, the dollar-yuan exchange rate is rising to around 7.24 yuan, and the dollar-yen exchange rate has fallen to around 145 yen. The Australian dollar-U.S. dollar exchange rate is at approximately 0.64 dollars, and the U.S. dollar-Singapore dollar exchange rate is recorded around 1.29 dollars.