iM Securities: This Week's Exchange Rate Outlook, 1,420-1,470 Won per Dollar

iM Securities announced on the 17th that it expects the Korean won to trade in a range of 1,420 to 1,470 per U.S. dollar this week.

Park Sanghyun, a researcher at iM Securities, stated in a weekly currency report titled "Persistent Anxiety vs. Government Intervention," "Given that the government has shown a strong intention to defend the exchange rate at the 1,470 won level, the dollar-won exchange rate is likely to remain in a wait-and-see mode this week, monitoring external factors rather than rising further."

Last week, the dollar-won exchange rate declined compared to the previous week due to government intervention. Park explained, "Although the dollar-won exchange rate had climbed to 1,470 won amid continued foreign capital outflows from the stock and bond markets, it turned downward following government intervention and the announcement of the U.S.-Korea tariff negotiation fact sheet."

He added, "Although uncertainty over interest rate policy continues due to a series of hawkish comments from Federal Reserve officials, the end of the federal government shutdown has temporarily slowed the dollar's strength. However, short-term funding market instability has not yet been resolved, and as the probability of a rate hold at the December Federal Open Market Committee (FOMC) meeting has increased over a rate cut, the dollar's weakness has remained limited." He summarized last week's atmosphere in this way.

As for this week's variables, he pointed to the stabilization of the U.S. short-term funding market. Park commented, "It may take more time for the full normalization of federal government functions, and above all, delays in the release of economic indicators are negatively affecting not only financial market uncertainty but also easing of tightness in the short-term funding market. Whether the U.S. short-term funding market eases-specifically, whether various credit indicators and Treasury yields stabilize downward-will be a key factor in the dollar's movement."

He further added, "Another variable to watch is the trend of the Japanese yen following the Japanese government's decision to implement a large-scale supplementary budget on the 21st." Last week, the yen weakened due to reports of the supplementary budget implementation.

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