The South Korean won sank to a 15-year low on Dec. 27, with the won-dollar exchange rate breaking the 1,480 won mark. As political uncertainties persist amid a strong U.S. dollar, the exchange rate is approaching the 1,500 won per dollar threshold.
The won-dollar exchange rate stood at 1,483.90 won per dollar around 11:16 a.m., up 19.1 won from the previous day, according to the Seoul Money Brokerage Services.
This marks the first time in 15 years and nine months since March 16, 2009 (1,488.5 won), during the global financial crisis, that the exchange rate breached the 1,480 won mark. Before the global financial crisis, the last time the exchange rate reached similar levels was during the Asian financial crisis on March 20, 1998 (1,472 won).
The local currency began trading at 1,467.5 won against the greenback, up 2.7 won from the previous day, but quickly surpassed the 1,470 won threshold before breaking through the 1,480 won mark. The value of the won declined rapidly ahead of a looming impeachment vote against acting President Han Duck-soo.
Political instability is also affecting the domestic stock market. The benchmark KOSPI index fell for the third consecutive day, dropping below 2,400.
Experts warn that the exchange rate could hit the 1,500 won mark. “The won-dollar exchange rate could reach 1,500 won around January or February next year,” said Park Sang-hyun, an economist at iM Securities. “Further upward revisions are possible depending on political developments, including the Donald Trump administration taking office.”
“The exchange rate rose by 30 to 35 won after President Yoon Suk-yeol declared emergency martial law, and increased by another 30 won ahead of the impeachment motion against acting president Han Duck-soo,” said Cho Yong-gu, an analyst at Shinyoung Securities.
“Domestic factors alone could push the exchange rate above 1,500 won, and if the new U.S. administration’s proposed universal tariffs are implemented in the first half of next year, it could climb to 1,550 won.”
