The won-dollar exchange rate was 1,389.7 won at 9 a.m. on the 21st. That was down 2.9 won (0.2%) from the previous transaction day's weekly closing price.
There is an outlook that the exchange rate could rise slightly on the day. That is because U.S. Government Bonds yields are climbing. Yields fell after the U.S. Treasury said it would expand the size of long-term Government Bonds buybacks, but turned higher in just one day. Min Kyung-won of Woori Bank said, "Tracking the rise in yields, the dollar will strengthen and affect the domestic foreign exchange market."
After the buyback announcement, the yield on the 30-year U.S. Government Bonds, which had fallen to 5.19%, rose more than 0.05 percentage point to 5.24% on the day. The 10-year also recovered its decline to 4.706%. As a result, the Standard & Poor's (S&P) 500 fell 0.87%, and the Nasdaq Composite fell 1%.
With U.S. stocks falling, there is also a possibility that foreign investors will continue net selling in the domestic Korea Exchange market on the day. When foreigners sell Korean stocks they hold and exchange the proceeds into dollars, the exchange rate tends to rise. Foreign investors recorded a net purchase of 1.7266 trillion won the previous day.
However, there is also an outlook that the rise in the exchange rate will not be large. Although the dollar is strengthening, major exporters such as SK hynix are intermittently selling dollars they hold. Global oil prices have risen due to the Middle East war, but that is why the exchange rate has fallen.