The South Korean won weakened beyond 1,520 per dollar, its lowest level since March 2009, as fading hopes for a swift resolution to the Iran war dampened risk appetite. In a rare prime-time address, US President Donald Trump offered no clear timeline for ending the conflict in the Middle East, saying the United States had nearly achieved its strategic objectives in Iran but cautioning that military operations could intensify over the next two to three weeks. His remarks also bolstered the US dollar, adding further pressure on other currencies.
At the same time, South Korea’s inflation accelerated to 2.2% in March, exceeding the Bank of Korea’s 2% target and underscoring growing price pressures, largely driven by higher energy costs linked to the Iran conflict. Earlier this week, Shin Hyun-song, the nominee to head the Bank of Korea, said the central bank should maintain a flexible monetary policy stance to navigate these risks. He played down concerns about the won’s weakness, however, stressing that market liquidity remains ample.
