Won's Competitiveness Gauge Hits 17-Year Low Amid Strong Dollar

The Korean won's competitiveness gauge has hit its lowest level in over 17 years due to the strong US dollar. The Bank for International Settlements (BIS) reported that the real effective exchange rate (REER) of the won fell to 82.99 in June, down 1.75 points from the previous month.

This reading was the weakest since March 2009, when the REER stood at 79.31 after the global financial crisis. The BIS' REER measures a currency's value against major trading partners after adjusting for inflation, serving as a gauge of international price competitiveness.

The decline in the REER came as the won weakened sharply against the US dollar, hitting 1,555 won per dollar in intraday trading on June 30. The currency also averaged 1,527.95 against the dollar in June, its weakest monthly average since February 1998 during the Asian financial crisis.