South Korean Won Sinks Toward Yearly Low Amid Middle East Crisis

SEOUL, March 4 (Bernama-Yonhap) -- The South Korean won fell markedly against the U.S. dollar on Wednesday, nearing its lowest level of the year, as heightened risk aversion weighed on the currency amid escalating tensions in the Middle East, Yonhap News Agency reported.

The won was quoted at 1,476.2 won per dollar, down 10.1 won from the previous session, extending its losses for the third consecutive session.

It marked the weakest level since Jan. 20, when it stood at 1,478.1 per dollar.

The currency had hovered above the key 1,450 won threshold in recent weeks after rebounding from a multiyear low near 1,500 won late last year, but has fallen sharply this week in line with a broad dollar rally amid concerns that the U.S.-Israel operation could escalate into a prolonged regional war.

Overnight, the currency briefly slid past the 1,500 won mark, breaching the psychologically important level for the first time since March 2009, when the country was grappling with the global financial crisis.

"Risk-off sentiment has intensified, boosting demand for the safe-haven dollar. The dollar's strength is likely to persist until geopolitical risks ease," Park Hyung-joong, an economist at Woori Bank, said.

The dollar index, which measures the greenback against six major currencies, stood at 99.195, up 0.182 from the previous session, marking its highest level since November 2025.

Financial market volatility intensified in South Korea, with the benchmark Korea Composite Stock Price Index (KOSPI) plunging 698.37 points, or 12.06 per cent, to 5,093.54 on Wednesday, marking its sharpest-ever decline.

Analysts said the Iran crisis triggered massive profit-taking, as the KOSPI had been on a bull run and hit a record high of 6,307.27 on Thursday, just before the Middle East tensions escalated.

-- BERNAMA-MNA