The North Korea currency crisis continues to escalate as authorities consolidate foreign exchange service centers across major cities. According to sources in Pyongyang, the number of local currency centers had grown over the past year. However, the government is now merging many of them or transferring operations to banks.
This move follows the state’s increasing struggle to manage exchange rate volatility. Authorities are absorbing centers near markets, department stores, and foreign-currency shops into official bank-run operations. These changes reflect the mounting pressure on the system to maintain financial control.
Earlier this year, these centers still exchanged euros, yen, and rubles. But by early July, only official banks could handle these currencies. Local sources confirm that the government ordered all foreign currency service centers to stop dealing with non-USD and non-CNY currencies.
The sharp rise in black-market exchange rates has fueled the North Korea currency crisis. According to market price surveys, the U.S. dollar rose from 8,300 won in January last year to over 30,000 won in recent weeks.
Previously, the government insisted that all centers follow a fixed rate of 8,900 won per dollar. Officials even distributed ideological materials demanding compliance. However, as the gap between official and market rates widened, centers began posting more realistic daily rates—still below market value but no longer fixed.
Despite this shift, authorities now admit they can’t manage the volatility. The country also appears to be running low on foreign currency reserves. Until last year, individuals could exchange up to $300 per day. Today, in Pyongyang’s Jung District, only $20 may be exchanged, if at all.
By contrast, exchanging dollars or yuan into won remains unrestricted. This suggests a desperate need for foreign currency. To tighten control, the government is cracking down on private money changers. Street-level traders are disappearing, and only trusted large-scale exchangers continue operating in secret.
However, even private changers hesitate to sell. The growing instability mirrors the aftermath of the 2009 currency reform. Many are hoarding dollars instead. Dollar-based loan sharks are also reemerging, lending U.S. dollars and demanding repayment with interest in the same currency.
In conclusion, the North Korea currency crisis highlights a deepening economic challenge. As the government struggles to defend the won, trust in official systems continues to erode. With centers closing and the dollar in short supply, market dynamics now dictate the value of North Korea’s currency more than ever.
