South Korean won falls sharply after president declares state of emergency

South Korea’s won on Tuesday fell sharply against the U.S. dollar shortly after President Yoon Suk Yeol declared a state of emergency.

The U.S. dollar was last seen trading up 1.4% against the won, which notched a fresh two-year low on the news.

The MSCI South Korea ETF fell more than 4% on the news, notching a new 52-week low, while the Franklin FTSE in South Korea slipped 3%.

Speaking during an unannounced televised briefing, South Korea’s Yoon accused opposition lawmakers of controlling the parliament and throwing the country into a political crisis.

It wasn’t immediately clear how the emergency measure would influence the country’s governance and democracy over the coming weeks. Yoon assumed office in May 2022 shortly after winning the presidential election by the narrowest margin in the country’s history.

His foreign policy stance has been dominated by a hardline stance on North Korea, while seeking to strengthen ties with the U.S. and Japan.

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