On the 5th, the won-dollar exchange rate fell by more than 11 won, dropping to the 1,350 won range. It is the lowest in about seven months since last October.
According to the Seoul foreign exchange market on this day, the won-dollar exchange rate recorded 1,358.4 won, down 11.1 won from the previous trading weekday transaction closing price (as of 3:30 p.m.). The exchange rate falling to the 1,350 won range during trading hours is the first time in about seven and a half months since last October.
The exchange rate on this day started at 1,363.5 won, down 6.0 won from the previous day, and then increased its decline. At 9:25 a.m., it fell below 1,360 won, and by 10:06 a.m., it dropped to 1,356.1 won. It then fluctuated in the high 1,350 won range before ending the weekly transaction.
It is interpreted as being influenced by the weakening dollar due to weak U.S. employment and service indicators. Overnight, U.S. employment information company Automatic Data Processing (ADP) stated that employment in U.S. private companies increased by 37,000 compared to the previous month. This is the lowest level in two years and two months.
The Purchasing Managers' Index (PMI) for the U.S. service industry in the previous month, compiled by the Institute for Supply Management (ISM), also fell 1.7 points to 49.9 from the previous month's 51.6. This index falling below the baseline (50) is the first since last June.
Domestically, foreigners buying domestic stocks fueled the decline in the exchange rate. On this day, foreigners bought a net 916.5 billion won in the stock market, pushing the index up. The Korea Composite Stock Price Index (KOSPI) closed at 2,812.05, up 41.12 points (1.49%) from the previous transaction day. It is the highest since July 18 last year (2,824.35, based on the closing price).
Wi Jae-hyeon, an economist at NH Futures, noted, "The dollar is showing weakness as economic indicators slow down amid Trump's indication that negotiations with China are very difficult," adding, "However, ahead of the non-farm payroll announcement on Friday, a cautious outlook may prevail over additional dollar weakening bets."