On the 17th, the won-dollar exchange rate ended weekly transactions at 1,458.0 won, up 1.0 won from the previous trading day.
On this day in the Seoul foreign exchange market, the won's exchange rate against the U.S. dollar opened at 1,451.0 won, down 6.0 won from the day before.
The won-dollar exchange rate, which turned higher right after the open, strengthened on signs that the U.S. Central Bank, the Federal Reserve (Fed), will delay its rate-cutting stance.
According to the CME FedWatch tool on this day, market participants put the probability that the Fed will cut its benchmark rate in December at 43.6%. As recently as a week ago, that figure was 67%.
Susan Collins, president of the Federal Reserve Bank of Boston, who can vote on Fed rate decisions, also said at a regional bank event held recently in Boston, "It seems appropriate to keep the benchmark rate at its current level for the time being."
However, with the Korean government making verbal, intervention-like comments about the exchange-rate market, the upside appears limited. On the 14th, Koo Yun-cheol, Deputy Prime Minister and Minister of Economy and Finance, said after the won-dollar exchange rate broke through the 1,470-won level, "There is a need to respond by actively using available tools."
Rhee Chang-yong, Bank of Korea governor, also said on the 12th, "We are watching exchange-rate volatility, and we are willing to intervene when moves are excessive."
Lee Jin-kyung, a researcher at Shinhan Investment & Securities, said, "Recent factors behind the weak won include trade uncertainty and economic concerns, U.S. uncertainty and a preference for safety," adding, "It will be hard to resolve in the short term, so the won-dollar exchange rate is increasingly likely to become stuck in the 1,400-won range."