The South Korean won rose above 1,540 per U.S. dollar in intraday trading on June 5, 2024 [1].
This currency devaluation marks the highest level for the won since the 2009 financial crisis, signaling significant economic pressure and instability in the Seoul foreign exchange market.
At 9:53 KST, the exchange rate reached 1,540.6 KRW per USD [1]. This represents the steepest climb for the currency since March 10, 2009, when the intraday rate peaked at 1,561.0 KRW per USD [1].
The market opened on June 5 at 1,529.0 KRW per USD [1]. This opening rate matched the closing rate from the previous day, June 4 [1]. Despite the intraday surge, the currency eventually closed the day at 1,532.00 KRW per USD [1].
Several factors contributed to the volatility. Market analysts said rising geopolitical risks in the Middle East and a trend of foreign investors selling Korean stocks contributed [1, 2]. Additionally, the currency was weighed down by fading optimism regarding a potential cease-fire between the U.S. and Iran [1, 2].
Data from the New York Non-Deliverable Forward (NDF) market also showed pressure, with the one-month night NDF rate sitting at 1,532.90 KRW per USD [1].
The rapid ascent toward the 1,540 level reflects a confluence of external shocks and internal capital flight. While the won did not surpass the absolute peak of the 2009 crisis, the proximity to that threshold suggests a period of acute vulnerability for the South Korean economy.
“The KRW/USD exchange rate rose above 1,540 per dollar intraday.”
A currency drop of this magnitude typically increases the cost of imports, fueling domestic inflation. When the won hits levels not seen since the 2009 global financial crisis, it suggests that international investors view the South Korean market as a high-risk zone, likely due to the combination of regional instability in the Middle East and a lack of confidence in local equity markets.
