On the 23rd, the won-dollar exchange rate rose by more than 9 won, reaching the 1,370 won level. The dollar, considered a safe asset, strengthened as concerns grew over an escalation of the Israel-Iran conflict amid U.S. involvement.
On that day, the won-dollar exchange rate in the Seoul foreign exchange market opened at 1,375.0 won, up 9.4 won from the previous trading day's closing price (as of 3:30 p.m.). The exchange rate has surpassed 1,370 won for the fourth consecutive transaction since the 18th (1,379.90 won).
U.S. President Donald Trump struck three major nuclear facilities in Iran, including Fordow, Natanz, and Isfahan, on the 21st (local time). This prompted Iran to signal retaliation, escalating concerns, and the Iranian parliament voted to block the Strait of Hormuz, a crucial international energy transportation route, overnight.
As geopolitical conflicts intensify, the dollar is showing strength. According to Investing.com, as of 9:24 a.m. that day, the dollar index (DXY), which shows the dollar's value against six major currencies, recorded 99.04. This marks an increase of 2 points compared to a week ago when it had dropped to the 97 level.
Non-dollar currencies are weak. The dollar-yen (yen per dollar) exchange rate recorded around 146.4 yen, surging to its highest level since the 14th of last month. The euro-dollar (dollar per euro) exchange rate rose to $1.148, up $0.01 compared to a month ago ($1.138).
Wi Jae-hyun, an economist at NH Futures, noted, "Both scenarios of direct U.S. military intervention and the blockade of the Strait of Hormuz, which were initially assumed to be the most extreme and least likely, have become more plausible.” He also mentioned, “At this stage, no decision can be assured, and the market may react with a simultaneous rise in oil prices and the dollar.”
Min Kyeong-won, a researcher at Woori Bank, said, “The won-dollar exchange rate is expected to rise, reflecting a decrease in risk appetite due to the reignition of geopolitical risks in the Middle East.” He added, “There is a strong possibility that declines in the stock market and currency weakness will also occur in Asian markets.” He further stated, “The exchange rate is projected to show upward pressure today, fluctuating around the mid-1,370 won level.”