PiCK
Weakened Korean Won Due to Foreign Investor Outflow... Exchange Rate Surpasses 1450 Won per Dollar [Hankyung Foreign Exchange Market Watch]
Summary
- It was reported that the won-dollar exchange rate surpassed 1450 won as the Korean won weakened due to net selling by foreign investors.
- The slight strengthening of the dollar index was analyzed to have influenced the rise in the exchange rate today.
- It was reported that foreign investors' large-scale net selling in the securities market acted as a major factor in exchange rate fluctuations.
The won-dollar exchange rate has surpassed the 1450 won level again after 5 days. Analysis suggests that the exchange rate rose as foreign investors turned to net selling in the stock market.
On the 10th, the won-dollar exchange rate (as of 3:30 PM) in the Seoul foreign exchange market closed the weekly trading at 1452.30 won, up 5.50 won (Korean won value decreased) from the previous trading day. The exchange rate rising above the 1450 won level comes 5 days after it reached 1454.50 won on the 5th. The exchange rate started at 1448 won, up 1.20 won, and then widened its gains. Around 12:22 PM, it rose as high as 1457 won.
The rise in the exchange rate was attributed to the dollar's slight strengthening. The dollar index, which shows the value of the dollar against six major currencies, rebounded from around 103.55 at 10:03 AM to 103.91 at 2:25 PM.
However, the dollar index is significantly lower than the 106-107 level at the end of last month, leading some to argue that the Korean won should be appreciating more if only the dollar value is considered.
Foreign investors' net selling of 436 billion won in the securities market also acted as a variable for the won's weakness. Although President Yoon Suk-yeol was unexpectedly released on the 8th following the court's decision to cancel his detention, it appears to have had little impact on exchange rate volatility.
The Japanese yen continued to strengthen. The won-yen cross rate at 3:30 PM was 984.04 won per 100 yen. This is up 3.72 won from 980.32 won at the same time on the previous trading day. The won-yen exchange rate exceeding 984 won is the first time in 21 months since May 16, 2023 (984.37 won). The yen-dollar exchange rate was at 147.66 yen, down 0.25%.
In the Seoul bond market, government bond yields generally rose (bond prices fell). The 3-year treasury bond yield closed at 2.596% per annum, down 0.031 percentage points. The 10-year and 30-year yields rose 0.028 and 0.015 percentage points to 2.801% and 2.596% per annum, respectively. Only the 5-year yield fell by 0.020 percentage points to trade at 2.658% per annum.
Reporter Jinkyu Kang josep@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
