The won-dollar exchange rate stood at 1,346.8 won as of 9 a.m. on the 7th. That was down 3.6 won (0.26%) from the prior trading day's weekly closing.
There is an outlook that the exchange rate could rise today. That is because the likelihood has increased that the United States will raise its benchmark interest rate. U.S. nonfarm payrolls rose by 162,000 in August, the biggest increase in five months. Seen as a sign the U.S. economy is not weak, this boosted the chances that the Federal Reserve (Fed) will raise rates in September.
As the exchange rate shows a rapid decline, demand to buy dollars on the cheap could also expand. In particular, the increase in Korean retail investors trading U.S. stocks is also a factor pushing the rate higher. Min Kyung-won, a Woori Bank researcher, said, "As the dollar index rises, it is highly likely to put the brakes on the won's strength," adding, "Bargain-hunting by importers and demand for currency exchange for residents' overseas stock investments are expected to lead today's rise in the exchange rate."
However, dollar selling by major domestic exporters is cited as a factor limiting the upside in the rate. When corporations sell dollars they hold, the won tends to strengthen in relative terms, which can push the exchange rate lower.