The won exchange rate has depreciated rapidly

The won has depreciated rapidly in recent days. The won-dollar exchange rate remained at around 1,370 won to the dollar on November 5, but broke through the psychological barrier of 1,400 won to the dollar on the 12th. On the 13th, the won-dollar exchange rate once reached 1,410.6 won to the dollar and closed at 1,406.6 won to the dollar, which is the lowest won-dollar exchange rate in two years since November 4, 2022.

The industry pointed out that after Trump was elected as the 47th president of the United States, the US dollar has been strengthening for several days; there are concerns that after Trump took office, the won-dollar exchange rate falling below 1,400 won may become the new normal.

On November 14, a Reuters poll showed that the Singapore dollar saw its first short bet in four months and reached its highest level in late June, while the won was the most shorted among Asian currencies. Since Trump’s victory, the dollar has surged to a one-year high in a few days, sending shocks to emerging markets, with the Malaysian ringgit and the Thai baht falling by about 4%. Respondents to the poll had the most unfavorable views on the Korean won, with short bets soaring to their highest level since early May.

Choi Sang-mok, South Korean Deputy Prime Minister and Minister of Strategy and Finance, said at the “Emergency Macroeconomic and Financial Symposium” on the 14th that with the change in the policy tone of the new US government, uncertainties such as world economic growth and price trends and the tone of monetary policies of major countries still exist. The government will pay close attention to market dynamics through a 24-hour joint monitoring mechanism and respond to possible fluctuations in a timely manner. Choi Sang-mok pointed out that while maintaining multiple response systems, the government will promptly and quickly implement active market stabilization measures when financial and foreign exchange markets are too volatile.