Reduced Impact and Implications of KRW Exchange Rates on Exports

Sora Lee () and Sungwoo Kang ()
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Sora Lee: Korea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr
Sungwoo Kang: Korea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr

No 22/2, i-KIET Issues and Analysis from Korea Institute for Industrial Economics and Trade

Abstract: The value of the Korean won (KRW) to the US dollar (USD) recently fell to its weakest level since 2009, and its real effective exchange rate (REER) was even lower. The KRW to USD rate exceeded 1,400 won per dollar due to the tight monetary policy of major economies, the Russian invasion of Ukraine, and fears of a recession. Companies highly vulnerable to FX risks should receive policy support and monitoring to prepare for price fluctuations. Long-term tasks include pursuing differentiation with comparative advantage based on key technologies, securing a leading position in supply chains, and upgrading Korea’s economic structure by increasing the contributions of domestic consumption to economic growth.

Keywords: monetary policy; money supply; exchange rates; USD-KRW; Korea; tight money; FX; foreign exchange; foreign exchange rates; competitiveness; exports; export competitiveness (search for similar items in EconPapers)
JEL-codes: F18 F21 O24 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2022-10-19
New Economics Papers: this item is included in nep-cis, nep-int and nep-mon
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