The won-dollar exchange rate is facing upward pressure around the 1,520 won mark due to resurfacing Middle East risks and weakened sentiment in semiconductor investments.
According to the Seoul foreign exchange market on July 8, the exchange rate was trading at 1,520.5 won against the U.S. dollar as of 9 a.m.
On this day, the rate opened at 1,515.8 won, down 12.4 won from the previous week's closing price, before partially recovering.
Uncertainties surrounding the Strait of Hormuz have resurfaced, leading to rising international oil prices and U.S. Treasury yields, while the dollar shows strength. As external uncertainties grow, risk-averse sentiment is also re-emerging.
Additionally, following Samsung Electronics' earnings announcement, global investors are reducing their exposure to the semiconductor sector, which is putting further pressure on the won. Analysts suggest that if foreign investment sentiment weakens in semiconductor stocks, it could lead to capital outflows from the domestic stock market and increased downward pressure on the won.
From a supply and demand perspective, the dollar-buying demand from companies preparing for mid-month import payments and the repatriation of foreign funds are also seen as factors supporting the lower end of the exchange rate.
The dollar index, which measures the value of the dollar against six major currencies, was around 101.17 as of 9:13 a.m.
Min Kyung-won, an economist at Woori Bank, stated, "Today's exchange rate will likely reflect the weakness in semiconductor stocks and the global strong dollar pressure, leading to upward pressure. If uncertainties related to the Middle East continue in European and New York markets, the won may also weaken alongside other Asian currencies, further increasing upward pressure on the dollar-won exchange rate."
* This article has been translated by AI.
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