Korean Won to Dollar Exchange Rate Stabilizes Around 1530 Won

As the strength of the dollar eases, the won-dollar exchange rate is fluctuating in the low 1530s.

According to the Seoul foreign exchange market, the rate was trading at 1530.5 won as of 9:10 a.m. It opened at 1530.0 won, down 0.3 won from the previous day's weekly closing price at 6 a.m.

The U.S. Institute for Supply Management's (ISM) manufacturing Purchasing Managers' Index (PMI) for June, released overnight, showed a moderate slowdown in line with market expectations, preventing the dollar from maintaining its strength. The previously accumulated dollar buying sentiment is also showing signs of easing.

The dollar index, which measures the dollar's value against six major currencies, briefly recovered above 101 during the previous day's trading but gave back most of those gains. As of 9:09 a.m. today, the dollar index stood at 100.87.

With the exchange rate falling about 30 won from recent highs, export companies that had been on the sidelines are gradually entering the market with their negotiation volumes. Analysts suggest there is a movement to sell dollars before the exchange rate declines further.

Min Kyung-won, an economist at Woori Bank, stated, "There is a high possibility that the supply-demand imbalance that led to one-sided exchange rate increases will ease. The foreign exchange authorities, which have repeatedly shown their commitment to market stability during periods of rapid exchange rate increases, are also likely to avoid providing factors that could stimulate the market, which may suppress offshore long (dollar buying) sentiment."

He added, "The payment demand from importers and the remittance demand from foreigners are factors supporting the lower end of the exchange rate. Importers, who need to make payments, may view the recent decline in the exchange rate as an opportunity for low-cost purchases."