Won-Dollar Exchange Rate Back to '1340 Won Range'... Touches Yearly High Amid Strong Dollar

The won-dollar exchange rate rose back to the 1,340 won level on the 17th, showing an upward trend.

On that day, in the Seoul foreign exchange market, the won-dollar exchange rate opened at 1,342.5 won, up 5.6 won from the previous trading day, and briefly touched 1,343.0 won in the early session. This is the same level as the yearly high recorded on May 17 (1,343.0 won).

[Image source=Yonhap News]

As of 9:30 a.m., the won-dollar exchange rate slightly declined to 1,341.0 won.

The dollar continues to strengthen amid growing expectations that the U.S. Federal Reserve's (Fed) tight monetary policy may be prolonged.

According to the minutes of the July Federal Open Market Committee (FOMC) released the previous day (local time), Fed officials judged that "it is important to maintain a sufficiently tight monetary policy stance to bring inflation back to the 2% target."

On the 14th, an employee is organizing dollars at the Hana Bank Counterfeit Response Center in Jung-gu, Seoul. Photo by Jinhyung Kang aymsdream@

The minutes came out more hawkish (favoring monetary tightening) than expected, leading to a stronger dollar. The dollar index, which shows the value of the dollar against the currencies of six major countries, rose to 103.54.

Meanwhile, the Chinese yuan is weakening due to sluggish economic conditions, fueling the rise in the won-dollar exchange rate. The domino default crisis in China's real estate sector has come to the forefront, and recently released economic indicators are being interpreted as signs of recession, increasing anxiety in the global financial markets.

However, as the won-dollar exchange rate is rising sharply, caution regarding fine-tuning by foreign exchange authorities is expected to limit the upper bound.

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