The won-dollar exchange rate came in at 1,372.5 won at 3:30 p.m. on the 28th to close weekly transactions. It fell 8.4 won (0.61%) from the previous trading day's weekly close. On the same basis, it is the lowest level in 13 months since July 24 last year (1,367.2 won). It is the first time the 1,370-won range has been recorded since Sept. 16 last year (1,378.9 won).
The rate hit 1,380.9 won at 9 a.m., then fluctuated before dropping to 1,371.8 won at about 3:27 p.m., just before weekly transactions ended. It is the lowest level since an intraday print of 1,370.9 won on July 25 last year.
The recent decline in the rate is seen as stemming from larger dollar selling by major export corporations. In particular, with the deadline for corporations' interim corporate tax payments at the end of this month, analysts noted there has been more dollar selling. At month-end, corporations' dollar selling tends to increase.
The Bank of Korea's currency tightening also appears to have affected the rate. The Bank of Korea set the base rate at 3%, raising it by 0.25 percentage point the previous day. It was a back-to-back hike in July and August. Shin Hyun-song, governor of the Bank of Korea, said the won would turn stronger with this rate increase.
Analysts also said the rate could vary depending on the Jackson Hole Economic Policy Symposium that opens at 11 p.m. Korea time on the day. Depending on the currency policy direction presented by Kevin Warsh, chair of the U.S. Federal Reserve (Fed), the rate could change. When the Fed raises rates, the dollar tends to strengthen.