'Trump Tariffs' Shake Exchange Rates... Back to 1440 Won Range (Update)

US Tariff Tensions Ease... Won-Dollar Exchange Rate Closes at 1,444.3 Won
Sharp Rise of 35.9 Won Over Two Sessions, Followed by 22.9 Won Drop in Two Days
Uncertainty Remains... Exchange Rate Volatility Expected to Continue for Now

As tariff tensions originating from the United States eased, the won-dollar exchange rate fell by nearly 20 won on the 5th.

Yonhap News

On that day, in the Seoul foreign exchange market, the won-dollar exchange rate closed at 1,444.3 won, down 18.6 won from the previous trading day as of 3:30 p.m.

The exchange rate started the day at 1,453.5 won, down 9.4 won, then widened its decline to reach 1,443.9 won just before the weekly trading close. The dollar showed weakness. The dollar index, which indicates the value of the dollar against six major currencies, recorded 107.791, down 1.01% from the previous trading day.

Expectations grew that U.S. President Donald Trump would reach a similar agreement with China after postponing tariffs on Mexico and Canada for one month. Although the U.S. imposed an additional 10% tariff on China starting from the 4th, and China also announced retaliatory tariffs on U.S. products, the market sees a high possibility that the two leaders will engage in negotiations through dialogue.

The recovery in risk appetite also influenced the exchange rate decline, as foreign investors engaged in net buying in the domestic stock market. On that day, the KOSPI closed at 2,509.27, up 27.58 points (1.11%) from the previous day. Foreign investors made net purchases worth 67.4 billion won in the KOSPI market.

However, it is expected that exchange rate volatility will continue as long as tariff uncertainties originating from the U.S. persist. The exchange rate, which surged 35.9 won over two trading days on the 31st of last month and the 3rd of this month due to global tariff war concerns, fell 22.9 won over two days on the 4th and 5th.

Wi Jae-hyun, an economist at NH Futures, said, "China's response to the U.S. tariffs on China that took effect the previous day shifted from concerns about dispute escalation to expectations for negotiations," but added, "Since the effective date of China's retaliatory tariffs is still scheduled for next Monday, and President Trump also mentioned that negotiations are not urgent, it is difficult to say that the uncertainty has been completely resolved."

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