Oil Price Surge Drives Treasury Yields to Two-Year High

The sharp rise in international oil prices has pushed U.S. long-term Treasury yields to their highest level in two years and ten months, reaching 4.821% on November 2nd. This increase is largely due to geopolitical tensions in the Middle East, with Brent crude futures closing at $95.6 per barrel on the London ICE futures exchange.

As a result of this upward pressure on Treasury yields, the dollar has gained strength, exerting upward pressure on the won-dollar exchange rate. The Dollar Index rose 0.8 points to 99.6 as of November 2nd. South Korean foreign exchange authorities are closely monitoring potential volatility expansion.

Min Kyung-won, an economist at Woori Bank, stated that 'chase buying by importers who had been waiting on the sidelines for a lower exchange rate' and residents' currency conversion for overseas stock investments could further push the won-dollar rate higher.