The won-dollar exchange rate opened higher as hopes for a U.S.-Iran peace agreement faded.
In the Seoul foreign exchange market on June 1, the exchange rate for the Korean won against the U.S. dollar was 1508.1 won. The rate opened at 1508.8 won, up 0.9 won from the previous session.
The renewed preference for safe assets appears to be linked to difficulties in the U.S.-Iran peace negotiations.
At the same time, the dollar index, which measures the value of the U.S. dollar against six major currencies, rose by 0.14 to 99.05.
On May 30, The New York Times reported that President Donald Trump did not approve a draft memorandum of understanding (MOU) aimed at ending the conflict between the U.S. and Iran.
Previously, U.S. and Iranian officials had tentatively agreed on the peace MOU, with only final approval procedures remaining.
An Iranian news agency also reported that Iran plans to propose new amendments, indicating that the country is thoroughly preparing for a no-deal scenario.
In the bond market, foreign investors have sold a net 1.4162 trillion won worth of securities.
Minkyoung Won, an economist at Woori Bank, stated, "The won-dollar exchange rate is expected to rise in line with increasing international oil prices due to weakened optimism regarding the U.S.-Iran negotiations. There is a high likelihood that foreign capital will continue to exit the domestic stock market, and even if individual and institutional buying supports the KOSPI, demand for remittances in the foreign exchange market will lead to an increase in the exchange rate."
* This article has been translated by AI.
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