Won-Dollar Exchange Rate Plummets by 20.5 Won... Weakened Expectations for US Interest Rate Hike

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

The won-dollar exchange rate fell by more than 20 won as expectations for additional interest rate hikes by the U.S. Federal Reserve (Fed) diminished.

On the 3rd, in the Seoul foreign exchange market, the won-dollar exchange rate closed at 1,322.4 won, down 20.5 won from the previous day.

On that day, the exchange rate opened at 1,335.0 won, down 7.9 won, and showed a downward trend, falling to as low as 1,317.4 won during the session.

Since the Fed held the benchmark interest rate steady at 5.25-5.5% annually at the November Federal Open Market Committee (FOMC) regular meeting, the value of the won against the dollar has been rising.

Fed Chair Jerome Powell stated, "Inflation has eased since mid-last year," and evaluated that "inflation figures last summer were quite favorable." Accordingly, the market has assessed that the Fed's rate hikes have effectively ended.

The U.S. 10-year Treasury yield, which had been on a high run, also fell nearly 30 basis points (1bp = 0.01 percentage points) over two days.

The won-yen recalculated exchange rate was 879.93 won per 100 yen, down 12.87 won from the previous day's 3:30 p.m. reference price of 892.80 won.

On that day, the won-yen recalculated exchange rate was at its lowest closing level since February 28, 2008 (889.23 won).

As the dollar weakened and the won's value rose, the won-yen recalculated exchange rate also saw a larger decline.

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