Foreign exchange authorities launched a verbal intervention as the won-dollar exchange rate surged sharply.

The Bank of Korea and the Ministry of Economy and Finance said in a media notice at 11:45 a.m. on June 8, under the joint names of Bank of Korea Director General for International Affairs Kyung-soo Yoon (윤경수) and Ministry of Economy and Finance Director General for International Finance Hyung-ryeol Lee (이형렬), that they would never tolerate excessive volatility and one-way market moves relative to fundamentals and would respond strongly.

The authorities said they judged that in the foreign exchange market recently, beyond supply and demand factors, some speculative foreign exchange transactions such as offshore non-deliverable forwards (NDF) had increased volatility.

The verbal intervention came as the won-dollar exchange rate in daytime trading exceeded 1,550 for the first time since the financial crisis.

In the Seoul foreign exchange market, as of 11:45 a.m., the won-dollar exchange rate was 1,553.1, up 14.0 won from the previous day, and rose as high as 1,555.2 during the session.

After the verbal intervention, the exchange rate pared some gains and fell to the 1,540s.