The Possibility of a Decline in the Value of the Korean Won: A Structural Issue, Not a Matter of Fear
Amid the recent weakness of the Korean won and rising exchange rates, a wide range of interpretations has emerged. Some dismiss the situation as a temporary consequence of global conditions, while others regard concerns as exaggerated crisis narratives. However, it is difficult to attribute the trajectory of the won solely to external factors when domestic structural issues have accumulated over a long period of time. The potential decline in the value of the won should not be viewed as a matter of fearmongering, but rather as a realistic issue that requires a comprehensive examination of fiscal policy, monetary policy, and economic structure. Repeated Cash-Based Fiscal Spending and Inflationary Pressure In recent years, South Korea’s fiscal management has increasingly relied on large-scale cash-based support measures under the banner of crisis response. While such policies may have produced short-term effects in stabilizing sentiment or stimulating consumption, they inevit...