Korean Won Plummets to Fourth-Lowest Level on Record in March Amid Foreign Stock Sell-Off

Deep News
Mar 29

Data show that the Korean won depreciated sharply against the U.S. dollar in March, falling to the fourth-lowest level on record, driven by foreign selling of Korean stocks. According to information from the Bank of Korea and Yonhap News Agency, the average exchange rate of the won against the dollar in the first 27 days of March, calculated based on the 3:30 p.m. daily rate, was 1,489.3 won per dollar. This marks the fourth-lowest monthly average on record, trailing only three months during the Asian financial crisis: December 1997 at 1,499.38, January 1998 at 1,701.53, and December 1998 at 1,626.75. On a weekly basis, the average exchange rate last week was 1,503.4 won per dollar, breaching the 1,500 threshold for the first time in 17 years since the second week of March 2009. In percentage terms, the won depreciated by 4.72% against the dollar in the first 28 days of March, the largest decline among major currencies. Over the same period, the U.S. dollar index, a common measure of the dollar's strength against a basket of six major currencies including the euro and the yen, rose by 2.6%. The euro fell by 2.62% against the dollar, the yen dropped by 2.58%, the Chinese yuan declined by 0.84%, and the New Taiwan dollar depreciated by 2.11%. The sharp depreciation of the won was primarily driven by heightened Middle East tensions and market concerns over the outlook for artificial intelligence technology, which triggered large-scale foreign selling of assets.

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