Market Sensitive to New Coronavirus... USD-KRW Exchange Rate Closes Up 7.8 Won

[Asia Economy Reporter Eunbyeol Kim] On the 30th, the KRW-USD exchange rate surged significantly.

On that day, in the Seoul foreign exchange market, the KRW-USD exchange rate closed at 1,185.0 KRW per dollar, up 7.8 KRW from the previous day's closing price. The exchange rate started at 1,179.0 KRW, up 1.8 KRW, and steadily increased its gains throughout the day.

The market is reacting sensitively to news of the novel coronavirus (Wuhan pneumonia). Due to a preference for safe-haven assets, there has been a strong risk-averse sentiment toward emerging market currencies and stocks. This is because concerns about a global economic slowdown, including China, are spreading as a result of the Wuhan pneumonia outbreak.

Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), identified the novel coronavirus as a factor of economic uncertainty during a press conference following the interest rate hold, which further strengthened the risk-averse atmosphere. In particular, although Chairman Powell said it is too early to say how much damage will occur, he stated, "There will definitely be an impact on China's total production in the short term."

Yoon Myung-sik, Deputy Governor of the Bank of Korea, also mentioned on the same day, "We will observe how the novel coronavirus develops and spreads, and how it affects our consumer sentiment and markets before reflecting it on growth, inflation, and the current account balance." He added, "There is still uncertainty, so it is too early to specify the extent at this point."

Deputy Governor Yoon continued, "We will continue to closely monitor the market situation caused by the spread of the novel coronavirus and watch with caution the impact it may have on our economy going forward."

This content was produced with the assistance of AI translation services.