The South Korean won (KRW) experienced a significant surge against the US dollar (USD) on Tuesday, recovering from a sharp decline the day before. This rebound was primarily driven by comments from US President Donald Trump, suggesting a potential de-escalation in the Middle East conflict.
The won opened trading at 1,470.8 per dollar, appreciating by 24.7 won compared to the previous session’s closing rate of 1,496.5 won.
Monday’s rate marked the weakest exchange rate for the won since March 12, 2009, a period when South Korea was heavily impacted by the global financial crisis.
The won’s recent depreciation was largely attributed to a strengthening US dollar amidst increased risk aversion following US-Israeli actions in Iran. Foreign investors selling off local stocks also contributed to the weakening Korean currency.
However, Trump’s statements served to alleviate anxieties surrounding a protracted and wider regional conflict, along with its potential negative impact on global oil supplies, leading to the won’s recovery.
