Korean won/dollar exchange rate starts Wednesday with decline

[Photo by Yonhap]

The Korean won started the day at 1,297.90 won against the U.S, dollar as of 09:08 a.m. on the Seoul foreign exchange market, down 3.50 won from the previous day.

It opened at 1,298.0 won, down 3.4 won, and is hovering in the upper 1,290 won range.

The won is showing limited strength as China’s foreign exchange authorities have raised their defense against currency depreciation.

China recently set the dollar-yuan benchmark exchange rate below market expectations in response to the yuan’s weakness and state-owned banks have collectively lowered their dollar deposit rates significantly.

The Japanese yen’s recent weakness has also raised the possibility of the Japanese government intervening in the foreign exchange market.

However, as the U.S. Federal Reserve is slated to release the minutes of the June Federal Open Market Committee (FOMC) meeting in the early Thursday morning, the decline in the won/dollar exchange rate is not expected to be significant.

As of 09:08 a.m. on Wednesday. the arbitraged exchange rate using the dollar as the intermediary currency touched 898.74 won per 100 yen, down 2.04 won from the previous trading day’s rate of 900.78 won. The arbitraged won/yen rate fell to the 800 won range during the trading session the previous day as well.