The won-dollar exchange rate against the U.S. dollar opened at 1,511.4 won on the 15th. It fell 8.4 won from the previous trading day.
On this day, the won-dollar exchange rate is expected to fall below 1,520 won on news of a U.S.-Iran end to war. When the war ends, investor sentiment for risky assets recovers. As demand for the safe-haven dollar weakens, the won-dollar exchange rate can decline.
U.S. President Donald Trump on the 14th (local time) posted a statement on his social media (SNS), saying, "The transaction with Iran is now complete," and "We have fully approved toll-free opening of the Strait of Hormuz and approved the immediate lifting of the U.S. Navy blockade." Pakistan Prime Minister Shehbaz Sharif, who served as a mediator in the end-of-war talks, also said, "I am pleased to announce that a peace agreement between the United States and Iran has been reached."
With the war over, some expect foreign investors to turn to net buying of domestic stocks. When foreigners exchange dollars for won to buy domestic stocks, the won strengthens and the won-dollar exchange rate falls.
Foreign investors posted a net purchase of 1.4 trillion won on the 12th. They ended 24 consecutive transaction days of net selling through the 11th and turned to buying. Min Kyung-won, a researcher at Woori Bank, said, "Optimism over the disappearance of Middle East war uncertainty is highly likely to emerge as a key driver in Asian markets," adding, "If foreign investor sentiment continues to recover, the groundwork has been laid to actively reflect a weak-dollar tone."