The won-dollar exchange rate against the U.S. dollar closed at 1,530.1 won on the 31st, up 14.4 won from the previous day. It is the first time the weekly transaction (9 a.m.–3:30 p.m.) closing price has topped 1,530 won since March 9, 2009 (1,549 won), during the global financial crisis.
The won-dollar exchange rate opened at 1,519.9 won on the day, up 4.2 won from the previous day. It even spiked to 1,536.9 won at 2:15 p.m. Although the gain narrowed ahead of the weekly transaction close, it ultimately ended trading around the 1,530-won level.
The rise in the won-dollar exchange rate is seen as the result of the prolonged war between the United States and Iran. When there is geopolitical risk, investor appetite for risk assets weakens in the market. In that case, the won, which is not a key currency, tends to fall in value.
U.S. President Donald Trump ratcheted up pressure, saying he would destroy Iran's power plants and oil facilities if cease-fire talks with Iran fall through. On the 30th (local time), Trump said on the social media platform Truth Social, "We will end our lovely stay in Iran by blowing up and completely obliterating all of their power plants, oil wells, and Kharg Island (probably all desalination facilities as well)." Trump also said toward Iran that it "would be retaliation for the countless soldiers and others of ours that Iran brutally butchered and killed during the 47 years of the old regime's reign of terror."
Meanwhile, the fact that foreign investors are exiting the domestic stock market is also fanning the rise in the won-dollar exchange rate. On the day, foreigners were net sellers of 3.8423 trillion won on the Korea Exchange main board.
Meanwhile, Shin Hyun-song, the Bank of Korea governor nominee, said he is not concerned about the level of the won-dollar exchange rate. Meeting with reporters at the Hanwha Financial Plaza office on Sejong-daero in Seoul, where he is preparing for his confirmation hearing, Shin said, "Given that dollar liquidity is currently favorable, there does not seem to be a need right now to directly link the exchange rate with financial instability as in the past."