Korean Won Continues to Fall Against the Dollar

U.S. service members in South Korea continue to gain continuing buying power as the won continues depreciate against the dollar:

The Korean won has weakened severely against the U.S. dollar, sending its value to 1,362 won per dollar as of Sept. 2 ― the lowest since April 2009. Excluding global financial crisis periods, the currency value is the lowest since April 2001 when the global economy had just started recovering from the IT bubble recession.

The won-dollar rate was once below 1,300 right after the U.S. Federal Reserve’s Federal Open Market Committee (FOMC) meeting, on the hopes that the Fed might pivot to decelerating the pace of its rate hikes. The dollar index (DXY), measuring the dollar value against six major currencies, came down to 105 by the end of July from the previous peak of 108. Now the index has moved up even further beyond 109, which is the highest since 2001.

The resurgence of the dollar index has stemmed from the weakening euro ― now below parity ― as well as concerns that the Fed will keep raising rates aggressively. In addition, the weakening Chinese yuan, amid China’s sluggish recovery and the central bank’s rate cuts, has caused the Korean won to weaken further. 

Korea Times

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