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The exchange rate between the South Korean Won (KRW) and the Brazilian Real (BRL) has exhibited notable fluctuations over the past few years, influenced by various economic factors in both countries. This report provides an analysis of the KRW/BRL exchange rate trends, focusing on the period from 2021 to mid-2025, and explores the underlying factors contributing to these movements.

Exchange Rate Trends from 2021 to Mid-2025

2021:

In 2021, the KRW/BRL exchange rate experienced a general decline. The year began with 1 KRW equivalent to approximately 0.00504 BRL on January 1, 2021. By June 30, 2021, the rate had decreased to 0.00436 BRL per KRW. This downward trend was influenced by Brazil's economic recovery post-pandemic, which strengthened the BRL, while South Korea faced challenges in its export-driven economy. (freecurrencyrates.com)

2022:

The downward trend continued into 2022, with the KRW/BRL exchange rate reaching 0.00430 BRL per KRW on March 1, 2022. Throughout the year, the rate fluctuated, reflecting global economic uncertainties and domestic economic policies in both countries. (freecurrencyrates.com)

2023:

In 2023, the KRW/BRL exchange rate showed signs of stabilization. On January 31, 2023, 1 KRW was equivalent to 0.00414 BRL. By March 31, 2023, the rate slightly decreased to 0.00396 BRL per KRW. This period of relative stability was marked by both countries implementing measures to bolster their economies amidst global economic challenges. (freecurrencyrates.com)

2024:

The year 2024 witnessed a significant appreciation of the KRW against the BRL. The exchange rate peaked at 0.004621 BRL per KRW on December 25, 2024, marking an 11.58% increase over the year. This appreciation was driven by South Korea's robust export performance and Brazil's economic policies aimed at controlling inflation, which impacted the BRL's strength. (exchange-rates.org)

2025:

As of mid-2025, the KRW/BRL exchange rate has experienced a slight depreciation. The highest rate recorded was 0.004290 BRL per KRW on March 4, 2025, while the lowest was 0.003863 BRL per KRW on April 2, 2025. The average exchange rate over this period was 0.004044 BRL per KRW, indicating a 5.86% decrease compared to the previous year. (exchange-rates.org)

Factors Influencing the KRW/BRL Exchange Rate

Several factors have contributed to the fluctuations in the KRW/BRL exchange rate over the past few years:

1. Economic Performance:

• South Korea: As an export-driven economy, South Korea's currency strength is closely tied to its export performance. Periods of strong exports, particularly in technology and automotive sectors, have bolstered the KRW. Conversely, global supply chain disruptions and decreased demand have led to KRW depreciation.

• Brazil: Brazil's economy is heavily influenced by commodity exports, including soybeans, iron ore, and oil. Fluctuations in global commodity prices directly impact the BRL. Additionally, domestic economic policies aimed at controlling inflation and stimulating growth have played a role in the currency's performance.

1. Monetary Policies:

• Interest Rates: Differences in interest rates set by the Bank of Korea and the Central Bank of Brazil affect capital flows. Higher interest rates in Brazil attract foreign investment, strengthening the BRL, while lower rates in South Korea can lead to KRW depreciation.

• Inflation Control: Efforts to control inflation through monetary tightening or easing influence currency strength. Brazil's measures to curb inflation have, at times, strengthened the BRL, impacting the exchange rate.

1. Global Economic Conditions:

• Trade Relations: Global trade dynamics, including trade agreements and disputes, affect both currencies. For instance, South Korea's trade relations with major partners like China and the U.S. influence the KRW, while Brazil's trade ties with China and other emerging markets impact the BRL.

• Commodity Prices: As a major commodity exporter, Brazil's currency is sensitive to global commodity price fluctuations. Periods of high commodity prices have strengthened the BRL, affecting the KRW/BRL exchange rate.

1. Political Stability:

• Policy Uncertainty: Political events, such as elections and policy changes, create uncertainty that can lead to currency volatility. Both South Korea and Brazil have experienced political events that have influenced investor confidence and currency strength.

Conclusion

The KRW/BRL exchange rate has been subject to various influences over the past few years, including economic performance, monetary policies, global economic conditions, and political stability in both South Korea and Brazil. Understanding these factors is crucial for businesses and investors engaged in trade or investment between the two countries. Continuous monitoring of economic indicators and policy developments will provide better insights into future exchange rate movements.