The won-dollar exchange rate against the U.S. dollar closed at 1,516.4 won on the 2nd, up 12.1 won from the prior trading day. From the 15th of last month through the day, it held above 1,500 won for 12 straight trading days on a closing basis. It surpassed the record of 11 consecutive trading days above 1,500 won from Feb. 24 to Mar. 10, 2009, during the global financial crisis.
The won-dollar exchange rate closed higher on the day despite reports that a U.S.-Iran cease-fire deal was imminent. If signs emerge that the war is ending, risk-asset investment sentiment tends to recover, reducing demand for the safe-haven dollar and likely pushing the won-dollar rate lower. However, the rise in global oil prices is seen to have expanded dollar demand.
Global oil prices closed higher on the 1st (local time). Brent futures rose 4.2% from the prior trading day to $94.98 per barrel, and West Texas Intermediate (WTI) futures climbed 5.5% to $92.16 per barrel.
U.S. President Donald Trump on the 1st said a memorandum of understanding (MOU) with Iran to end the war could be reached within a week. But he said, "There are still a few issues to resolve." President Trump repeatedly stressed that Iran must not possess nuclear weapons by any means.
Net selling of domestic stocks by foreign investors also played a role. When foreigners sell domestic stocks and exchange the proceeds into dollars, increased dollar demand becomes a factor pushing the won-dollar rate higher. Foreigners were net sellers of 2.914 trillion won the previous day and a further 6.594 trillion won on the day. Foreign net selling totaled 43 trillion won in Mar., 4 trillion won in Apr., and 44 trillion won in May.