The won-dollar exchange rate, which had touched the 1,450-won level, opened lower on the 6th and showed signs of calming.
On this day, the won-dollar exchange rate opened at 1,442.0 won on the Seoul foreign exchange market, down 7.4 won from the previous trading day. The day before, the won-dollar rate broke through 1,450 won intraday as foreigners sold domestic stocks in large volumes. It was the first time the rate rose to the 1,450-won level since Apr. 11.
It is interpreted that expectations that the Trump administration could lose a lawsuit related to a reciprocal tariff pulled down the won-dollar rate.
The U.S. Supreme Court on the 5th (local time) began hearings to determine whether the tariffs imposed by President Donald Trump on major countries were appropriate measures. Korea was also initially hit with a 25% tariff, but lower courts viewed Trump's use of emergency powers to impose tariffs as illegal.
Min Kyung-won, a Woori Bank researcher, said, "Chief Justice John Roberts of the U.S. Supreme Court noted that tariffs are taxes imposed on the American people and that this is defined as a power of Congress," adding, "If the Supreme Court finds the reciprocal tariff illegal, the tariffs collected under the reciprocal tariff would have to be returned, reviving fiscal concerns."
Easing risk aversion also contributed to the decline in the won-dollar rate. Overnight on Wall Street, the tech-heavy Nasdaq composite index rose 151.16 points, or 0.65%, to close at 23,499.80. Just the previous day, it had fallen more than 2% on concerns about an artificial intelligence (AI) bubble, but it rebounded in a day on the back of strong private employment data and bargain hunting.
According to Automatic Data Processing (ADP), U.S. private-sector employment in October increased by 42,000 from the previous month. Employment, which had declined for two straight months, turned to growth last month.
Wi Jae-hyeon, a researcher at NH Futures, said, "Despite solid U.S. economic indicators, a recovery in risk appetite pushed the dollar lower."
At the same time, "Persistent uncertainty factors and bullish dollar bets support the downside," adding, "Liquidity indicators that had recently weighed on the market have eased somewhat, but if a shutdown is prolonged, there is room for them to flare up again."