On the 30th, the won started in the 1,433 range against the U.S. dollar.
In the Seoul foreign exchange market that day, the won-dollar exchange rate opened at 1,433.5 won, up 3.7 won from the previous day's weekly transaction closing price as of 3:30 p.m. It was down 0.6 won from the 2 a.m. closing price of 1,434.1 won.
The main driver for the higher open was the decline in New York stocks that morning Korea time. The three major New York stock indexes fell across the board as more investors sold shares that had risen ahead of year-end to lock in profits. When stock dumping increases, risk appetite for assets such as the won weakens, pushing the exchange rate higher.
The Dow Jones Industrial Average fell 249.04 points, or 0.51%, to 48,461.93; the Standard & Poor's (S&P) 500 declined 24.20 points, or 0.35%, to 6,905.74; and the Nasdaq dropped 118.75 points, or 0.50%, to 23,474.35.
However, expectations of stealth intervention by the foreign exchange authorities limited the rise. Starting with strong verbal intervention on the 24th, the authorities and the government are going all-out to manage year-end closing prices, including measures to grant tax exemptions to Korean retail investors trading U.S. stocks returning to the domestic stock market. It is highly likely they will not let their guard down against a rise in the exchange rate through the 30th, the last trading day of the year.
Min Kyung-won of Woori Bank said, "Today the exchange rate is expected to fall, centering on the low 1,430 won range," adding, "Along with the authorities' intervention volume, active dollar selling by exporters could create appreciation pressure on the won."