The won-dollar exchange rate opened at 1,504.9 won on the 23rd. That was up 4.3 won from the previous transaction day.
After the open, it rose as high as 1,511.8 won. This is the highest level since Mar. 10, 2009 (1,561 won), during the global financial crisis.
The rise in the won-dollar exchange rate was due to heightened geopolitical risks after U.S. President Donald Trump warned that he would devastate Iran's power plants unless the Strait of Hormuz was fully opened. In such cases, market sentiment to invest in risk assets tends to weaken, and the value of the won, which is not a key currency, tends to fall.
On the 21st (local time), President Trump said on social media (SNS), "If Iran does not fully open the Strait of Hormuz within 48 hours from now without any threats, we will devastate various Iranian power plants, starting with the largest power plant."
As Iran blockaded the Strait of Hormuz, a global crude oil shipping route, and international oil prices jumped, President Trump ratcheted up the pressure. In response, Ebrahim Zolfaghari, Spokesperson for Khatam al-Anbiya Central Military Headquarters, which exercises unified command over Iran's forces, said, "If the U.S. threat targeting Iranian power plants is carried out, the Strait of Hormuz will be completely closed." He also said, "It will not reopen until the power plants are rebuilt."
Min Kyung-won, a researcher at Woori Bank, said, "There is a high likelihood that the triple negatives of a surge in international oil prices, a sharp drop in the New York stock market, and a stronger dollar will persist in Asian markets," adding, "(This) will increase the downward pressure on the won, a risk currency."
Meanwhile, the deadline set by President Trump falls on the morning of the 24th in Korea time.