South Korea's central bank issued a warning on Wednesday that the won could face downward pressure again.

The Bank of Korea pointed out that the main risk factors facing the won include frustrated expectations of US interest rate cuts and geopolitical conflicts in the Middle East. These external factors may have a negative impact on the won exchange rate.

This week, as the won and yen fell towards the key psychological levels of 1,400 and 160 against the dollar, respectively, the finance chiefs of South Korea and Japan jointly expressed concerns about the sharp decline of their currencies and vowed to defend their currencies.

The Bank of Korea said that the recent weakness of the won has exceeded the rise of the US dollar, which means that the value of the won relative to the US dollar is declining.

The Bank of Korea vowed to strengthen monitoring of risk factors and take measures to stabilize the market when necessary. This shows that the Bank of Korea is closely monitoring market dynamics and is ready to intervene if necessary to maintain the stability of the won.

While interest rate differences usually affect exchange rates, historical data shows that the state of the real economy has a greater impact on the won exchange rate. For example, global crises such as the collapse of the Internet bubble and the collapse of Lehman Brothers were direct causes of the Korean won's plunge.