Won Hits 11-Month Low Against Dollar

The won-dollar exchange rate closed at 1386.5 on the 21st, down 6.1 won from the previous trading day, marking its lowest point in approximately 11 months since September 17 of last year. The dollar's decline on this day was led by selling pressure centered offshore.

In his inauguration speech on the 21st, Bank of Korea Vice Governor Kwon Min-soo stated that the exchange rate is fundamentally moving downwards and that it is time for policy decisions that are balanced, prudent, and flexible when necessary. Kwon added that all aspects, including growth, inflation, and financial stability, must be considered, and that the effects and side effects of interest rate hikes should be examined together.

The bond market showed weakness. On the 21st, the yield on 3-year government bonds rose 4.3 basis points to 3.854% and the 10-year yield rose 5.3 basis points to 4.376%. Notably, the 20-year bond yield closed at 4.664%, up 6.3 basis points, hitting its highest level in 15 years and 4 months. The yield on 2-year monetary stabilization bonds closed at 3.753% and the 30-year government bond yield closed at 4.703%, both higher.

In the government bond futures market, the 3-year futures fell 9 ticks to 103.13, the 10-year futures fell 46 ticks to 105.11, and the 30-year futures fell 54 ticks to 104.64.