[Seoul = Newsis] Reporter Hong Hyo-sik – On the morning of the 7th, the Kospi opened at 2359.25, down 106.17 points (4.31%) from the previous trading day (2465.42). The index is displayed on the electronic board in the dealing room of Hana Bank, located in Jung-gu, Seoul. The KOSDAQ index started trading at 667.02, down 20.37 points (2.96%) from the previous trading day (687.39). In the Seoul foreign exchange market, the won-dollar exchange rate began at 1462.0 won, jumping 27.9 won from the previous day’s closing price of 1434.1 won. 2025.04.07. yesphoto@newsis.com
[Seoul = Newsis] Reporter Nam Joo-hyun – The won-dollar exchange rate, which had dropped over 30 won following the dismissal of former President Yoon Seok-yeol, is back to threatening the 1470 mark in just one day. The Kospi fell nearly 5%, breaking below the 2400 mark, and a sell-side circuit breaker was triggered for the first time in eight months due to concerns over a global trade war initiated by Trump’s administration. The phenomenon of a flight to safe assets has intensified while being influenced by the Federal Reserve’s indication of adjusting the pace of interest rate cuts.
According to the Korea Exchange on the 7th, a sell-side circuit breaker was triggered in the Kospi market at 9:12:11. This was due to a drop in futures prices (5% or more for over a minute). As a result, program sell orders in the securities market are suspended.
On this day, the Kospi opened at 2359.25, down 4.31% from the previous trading day, and began the session below the 2400 mark. The KOSDAQ started at 667.02, down 3.96%. As of 9:20 a.m., the Kospi is down 4.74% to 2348.54, with foreign investors selling off 407.2 billion won, leading the index decline.
The exchange rate soared. According to the Seoul foreign exchange market, as of 9:28 a.m. today, the won-dollar rate is trading at 1469.7 won, up 32.6 won from the previous day (1434.1 won). The rate started at 1462.0 won, up 27.9 won, expanding its rise to reach 1469.9 won at one point.
The won-dollar exchange rate had fallen to 1434.1 won on April 4th—dropping by 32.9 won, marking the largest decline in two years and five months—due to the easing of political uncertainty following the impeachment of the former president and concerns about a slowdown in the US economy leading to a weak dollar. It has now returned to the 1460 won level in just one day.
This financial market turmoil is driven by concerns over a global trade dispute following Trump’s administration’s imposition of mutual tariffs and China’s retaliatory tariffs. China plans to impose a 34% tariff on US goods, matching the rate imposed by the US, starting on the 10th.
On April 4th, the Dow Jones 30 on the New York Stock Exchange (NYSE) in the US closed at 38,314.86, down 5.5% from the previous day. The S&P 500 index plummeted by 5.97%, while the tech-heavy NASDAQ index also fell by 5.82%.
The Fed’s cautious approach to rate cuts is also creating upward pressure on the exchange rate. Chairman Powell, in a public speech at a conference in Arlington, Virginia, on the 4th, stated, “The economic impact of tariffs is expected to be greater than anticipated, including increased inflation and sluggish growth,” and indicated that he would not rush adjustments to monetary policy.
On the same day, President Trump took to social media to pressure a rate cut, saying, “Now is the perfect time for Chairman Jerome Powell to cut rates.” The Dollar Index, which indicates the relative value of the dollar against the currencies of six major nations, moved from the 102 range to the 103 range and fluctuates between those levels.