The South Korean Won has slipped to a six-month low against the US Dollar as continuing tensions with the North curbs demand for South Korean assets.
The past few weeks has seen the North escalate tensions by threatening to attack US military bases in Asia and to resume its war with the democratic south. It ripped up the ceasefire treaty from the Korean War and cut communication links with the South and US as the communist regime headed by Kim Jong Un protests at United Nations sanctions and the USA’s joint military exercises with the South.
Today it banned workers from the south from entering the joint run Kaesong industrial zone in the north, a move that Unification Ministry spokesmen Kim Hyung Suk described as ‘extremely serious’.
The rising threat of war on the peninsula has also been exacerbated by the North’s announcement that it intends to reopen a nuclear complex in Yongbyon that could potentially provide the regime with the means to create uranium enriched nuclear weapons.
The US secretary of state of John Kerry said, “The bottom line is simply that what Kim Jong Un is choosing to do is provocative. It is dangerous, reckless. The United States will not accept the Democratic People’s Republic of Korea (DPRK) as a nuclear state. And I reiterate again the United States will do whatever is necessary to defend ourselves and defend our allies, Korea and Japan. We are fully prepared and capable of doing so, and I think the DPRK understands that.”
With tensions set to remain high in the coming days the Won is expected to weaken further. The Korean situation also has the potential to affect the currencies of the Japanese Yen and the Australian and New Zealand Dollars.
As of 12:00pm
The Pound Sterling to Korean Won exchange rate is currently trading in the region of 1688.686
The Euro to Korean Won exchange rate is currently trading in the region of 1432.344
The US Dollar to Korean Won exchange rate is currently trading in the region of 1117.363
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