Synopsis
On February 3, the South Korean won fell sharply against the US dollar, reaching an annual low amid rising concerns over the impact of Donald Trump's tariff policies on the local economy.Key Takeaways
- The Korean won opened at 1,466 won per dollar.
- Lowest level this year recorded at 1,471.35 won.
- Concerns over Trump's tariffs on imports from Canada and Mexico.
- Negative impact anticipated on major South Korean companies.
- Benchmark KOSPI index fell by 2.24 percent.
Seoul, Feb 3 (NationPress) The South Korean currency has experienced a significant depreciation against the US dollar on Monday, triggered by escalating worries regarding the repercussions of the Donald Trump administration's extensive tariff strategy on the South Korean economy and its businesses.
The Korean won commenced trading at 1,466 won per dollar, reflecting a decline of 13.3 won from the previous trading day, and further plummeted to 1,471.35 won by 10 a.m.
This figure marks the lowest point recorded this year, surpassing the earlier low of 1,470.8 won noted on January 13, according to reports from Yonhap news agency.
The local currency has remained close to the 1,450 won threshold since December, a level not seen since March 2009 following the global financial crisis, largely due to the persistent strengthening of the dollar fueled by Trump's tariff threats and a national political turbulence instigated by President Yoon Suk Yeol's declaration of martial law.
On Saturday (U.S. time), Trump declared that he would impose 25 percent tariffs on imports from Canada and Mexico, along with a 10 percent tariff on goods from China, effective Tuesday. He also committed to introducing new tariffs on products from the European Union.
The extensive tariffs and anticipated retaliatory actions are feared to have negative repercussions for South Korean firms with production facilities in these nations.
On Monday, South Korean stocks opened significantly lower due to concerns regarding the U.S. decision to levy high tariffs on imports from Canada and Mexico, which could potentially impact South Korean enterprises operating there.
The benchmark Korea Composite Stock Price Index (KOSPI) dropped 56.45 points, or 2.24 percent, to 2,460.92 within the first 15 minutes of trading.
This development is expected to negatively affect prominent companies such as Samsung Electronics, LG Electronics, and other major South Korean firms with manufacturing bases in those territories.
Blue-chip stocks fell broadly, with market giant Samsung Electronics decreasing by 2.1 percent and its rival in chipmaking, SK hynix, tumbling by 3.77 percent.
Shares in the automotive and steel sectors also traded in the red. Hyundai Motor and Kia experienced declines of 1.46 percent and 2.25 percent, respectively, while leading steelmaker POSCO Holdings dropped by 4.03 percent.
