04-05-2025
Won's volatility over dollar deepens over Washington's tariff uncertainties
The Korean currency's volatility over the dollar deepened last month due to uncertainty surrounding Washington's sweeping tariffs on American imports, according to central bank data on Sunday.
The average daily fluctuation in the won-dollar rate for April was 9.7 won, or 0.9 percent, according to the data by the Bank of Korea.
This marked the largest volatility since November 2022, when fluctuations reached 12.3 won and 0.9 percent amid optimism over a potential shift in the U.S. Federal Reserve's monetary policy.
The April figures were also far higher than those of March, which were 4.3 won and 0.29 percent.
The Korean won weakened to 1,487.6 won against the dollar in intraday trading on April 9, when the country-specific reciprocal US tariffs took effect.
However, it rebounded to 1,420 won just two days later, following an announcement by U.S. President Donald Trump granting a 90-day pause on the reciprocal tariffs.
Experts forecast that the won-dollar exchange rate will remain volatile, likely hovering around 1,400 won, with future movements closely tied to developments in US-China trade talks.
"As the Korean won is highly correlated with other Asian currencies, including the Chinese yuan, the outcome of US-China trade negotiations is critical," said Moon Jeong-hee, an economist at KB Kookmin Bank. (Yonhap)
