Ahead of Trump's Administration Launch... Exchange Rate Rises by 1.6 Won [Hankyung Forex Market Watch]

Ahead of the inauguration of U.S. President-elect Donald Trump, the won-dollar exchange rate slightly rose (the value of the won fell). Although the strong dollar was somewhat calming, it was analyzed that there was high caution due to the launch of the Trump administration.

On the 17th, in the Seoul foreign exchange market, the won-dollar exchange rate (as of 3:30 PM) ended weekly trading at 1,458.30 won, up 1.60 won from the previous day. It traded in the 1,450 won range for two consecutive days following the 16th (1,456.70 won).

The exchange rate opened at 1,457.90 won, up 1.20 won, and moved between 1,453.10 won and 1,458.40 won. The market sees heightened caution ahead of Trump's inauguration on the 20th. Seonghoon Seo, a senior researcher at Hana Bank, stated, "With Trump's inauguration imminent, any prediction becomes meaningless," adding, "The wait-and-see stance continues."

The strong dollar is somewhat calming. The dollar index, which shows the value of the dollar against the currencies of six major countries, recorded 109.138, similar to the previous day. It slightly decreased from recently surpassing 110, reaching the highest level in two years.

On the morning of the same day, Acting President and Deputy Prime Minister Sangmok Choi emphasized at the macroeconomic and financial issues meeting that with the high internal and external uncertainties due to the launch of the new U.S. administration next week, each institution will make every effort to closely monitor U.S. new government policies and international financial market trends and manage them as stably as possible.

The yen is strong. This is because the Bank of Japan hinted at the possibility of raising the policy rate next week. As of 3:30 PM, the won-yen fiscal exchange rate is 936.94 won, up 4.23 won from the same time the previous day (932.71 won). The yen-dollar exchange rate fell by 0.34% to 155.63 yen per dollar.

Meanwhile, the Seoul Foreign Exchange Market Council announced that the foreign exchange market, where transactions are conducted through foreign exchange brokerage companies, will be closed on the 27th, designated as a temporary holiday.

Reporter Kang Jin-kyu josep@hankyung.com