The USD-KRW exchange rate closed in the late 1,450 won range on July 25 as dollar selling sentiment solidified amid thin trading ahead of the weekend. The rate finished at 1,458.50 won at 6 a.m., down 8.10 won from the previous Seoul session close of 1,466.60 won, driven by exporter negotiated dollar sales and supply-side factors including SK Hynix ADR conversion flows and shipbuilder forward contract sales. External conditions pointed to risk-off sentiment during the session, with rising international oil prices, Middle East geopolitical instability, and a sharp decline in domestic stock markets, yet dollar supply dominance pulled the exchange rate lower for several consecutive days.
Exporter Dollar Sales Drive Exchange Rate Decline
The USD-KRW exchange rate confirmed its upper range at 1,476.30 won at 8:42 a.m. on July 24, then quickly reversed direction lower as exporter negotiated dollar sales poured into the market ahead of month-end and the weekend. Recent dollar supply factors have been prominent, including SK Hynix American Depositary Receipt (ADR) conversion-related flows and heavy industry forward contract sales. Supply-side pressure weighed heavily on USD-KRW amid weakened long sentiment.
Foreign Investors Net Sold Over 38,000 Dollar Futures Contracts
In the currency futures market, foreign investors continued their net selling flow of dollar futures, strengthening dollar selling sentiment. Foreign investors net sold over 38,000 dollar futures contracts.
USD-KRW Breaks Below 1,460 Won Level During New York Session
The USD-KRW rate, which found support in the early 1,460 won range during the Seoul session, broke below the 1,460 won level during thin New York trading hours. USD-KRW expanded its decline to 1,458.50 won at 5:59 a.m. on July 25. This marked the lowest level since the intraday low of 1,457.90 won on May 8. Compared to the New York close 24 hours earlier at 1,474.20 won on July 24 at 6 a.m., the rate fell 15.70 won.
Trump Threatens EU Tariffs as Oil Prices Fluctuate
The dollar index rose slightly amid euro weakness. U.S. President Donald Trump threatened to impose substantial tariffs "in the near future" in response to the European Union imposing fines on American big tech companies. International oil prices temporarily declined during the session after news emerged that Pakistan, a mediator between the U.S. and Iran, was pursuing resumed talks with China's support. However, Trump indicated he was in serious dialogue with Iran but suggested launching large-scale attacks if no agreement was reached, raising market vigilance again. September delivery West Texas Intermediate (WTI) crude oil recorded around $90 per barrel, down approximately 1.8% from the previous session.
July Services PMI Reaches Eight-Month High
According to S&P Global, the preliminary July services Purchasing Managers' Index (PMI) recorded 53.6. This represented a 2.4-point increase from June's reading of 51.2, marking the highest level in eight months. Market participants are awaiting the Federal Open Market Committee (FOMC) meeting scheduled for July 28-29 (local time). At the same time, the dollar index stood at 101.483, slightly higher. The USD-JPY exchange rate was 163.845 yen, and the EUR-USD exchange rate was 1.13721 dollars. The offshore USD-CNH exchange rate was 6.7702 yuan.
FAQ
What caused the USD-KRW exchange rate to fall on July 25?
The USD-KRW exchange rate fell to 1,458.50 won on July 25 due to exporter negotiated dollar sales and supply-side factors, including SK Hynix ADR conversion flows and shipbuilder forward contract sales, which created dollar selling pressure ahead of month-end and the weekend.
What was the lowest level reached by USD-KRW on July 25?
USD-KRW reached 1,458.50 won at 5:59 a.m. on July 25, marking the lowest level since the intraday low of 1,457.90 won recorded on May 8.
How many dollar futures contracts did foreign investors sell?
Foreign investors net sold over 38,000 dollar futures contracts in the currency futures market, continuing their net selling flow and strengthening dollar selling sentiment.
