Finance Ministry, BOK vow to respond to won's volatility in rare joint statement
Strong verbal response comes after dollar-won exchange rate surges past 1,550 for the first time since 2008.
A person exchanges currency at a money exchange window in Myeongdong, Jung District, on June 7.
YONHAP
The Finance Ministry and Bank of Korea warned that they will "never tolerate excessive volatility and one-sided market moves that are inconsistent with economic fundamentals and will respond forcefully” in a rare joint verbal statement issued on Monday to stabilize the foreign exchange market.
"We believe that, in addition to supply and demand factors, some speculative foreign exchange transactions, including offshore non-deliverable forwards, have recently increased volatility in the foreign exchange market,” said Yoon Kyoung-soo, director of the Bank of Korea's International Department, and Lee Hyung-ryul, director general of the international finance bureau at the Finance Ministry, in a joint statement released at 11:45 a.m.
The official statement came after the dollar-won exchange rate rose above 1,550 during daytime trading for the first time since the 2008 global financial crisis.
The won weakened by 14 won in Seoul trading from the previous session to trade at 1,553.1 won against the greenback at 11:45 a.m.
The exchange rate also climbed as high as 1,555.2 won during the session.
Following the authorities' verbal intervention, the won recovered some ground, with the exchange rate retreating to the 1,540 won range.
As the won has continued to weaken sharply this year, officials have made relatively frequent remarks aimed at curbing excessive market volatility and one-sided movements.
However, this marked only the second official verbal intervention of the year, following a similar move on March 22.
BY CHO MUN-GYU [[email protected]]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
