On the 24th, the won/dollar exchange rate rose by more than 14 won, closing at 1430 won. The dollar strengthened as signs of easing U.S.-China trade tensions emerged. The decline in the Korean won's value was also influenced by the announcement of a contraction in the country's first-quarter gross domestic product (GDP) for the first time in three quarters.
On that day, the weekly closing price for the won/dollar exchange rate in the Seoul foreign exchange market (as of 3:30 p.m.) was recorded at 1435.0 won, up by 14.4 won from the previous day. The exchange rate started at 1427.0 won, up by 6.4 won from the day before, and increased further, rising to the mid-1430s after 3 p.m.
As hopes for progress in U.S.-China trade negotiations have heightened, the dollar is showing strength. Overnight, U.S. President Donald Trump noted, "We will set the tariff rate within the next 2 to 3 weeks," adding that "China could be included." A spokesperson for the Ministry of Foreign Affairs of China also stated in a regular briefing, "If we have to fight, we will fight to the end, but the door for dialogue is wide open."
The U.S. dollar has turned strong. According to Investing.com, the dollar index, which represents the dollar's value against six major currencies, was recorded at 99.48 in the afternoon. Considering it had dropped to the 97 range on the 21st, this reflects a slight increase.
The first-quarter growth rate, which was below expectations, also seems to have impacted the drop in the exchange rate. According to the Bank of Korea, the real GDP for the first quarter fell by 0.2% compared to the previous quarter, significantly below the Bank of Korea's forecast of 0.2% made in February. It is the first time since the second quarter of last year (-0.2%) that quarterly growth has recorded a negative.
Jo Yong-gu, a researcher at Shinyoung Securities, said, "The fact that the exchange rate started to rise due to the easing of U.S.-China tensions but maintained an upward trend suggests that the weak first-quarter GDP performance has also affected the exchange rate," adding that "the slowdown in the rise is expected to increase speculation for interest rate cuts, acting as a factor for the weak won."
As of 3:30 p.m. that day, the won/yen exchange rate was traded at 1004.80 won per 100 yen. This is up 2.83 won from the previous day's reference price of 1001.97 won. The dollar/yen exchange rate decreased by 0.62 yen to 142.77 yen.