On March 31, the first day of resumed short selling in the stock market, the won-dollar exchange rate in the Seoul foreign exchange market reached its highest level since the financial crisis. The rise in the exchange rate coincided with a sharp decline in the stock market due to resumed short selling amid growing caution ahead of potential new tariffs by the Trump administration on April 2.
The KOSPI index fell by more than 3%, breaking below the 2,500 mark, which intensified foreign selling pressure and fueled further exchange rate increases.
Wi Jae-hyun, a researcher at NH Futures, told Business Korea: “The uncertainty surrounding domestic impeachment proceedings coupled with a surge in net foreign stock sales led to this exchange rate increase.”