South Korean Won Weakens Toward 17-Year Low

2026-06-02 03:20 By Erika Ordonez 1 min. read

The South Korean won weakened past 1,517 per dollar, approaching the more than 17-year low of around 1,520 reached on May 22, as renewed Middle East tensions boosted oil prices and supported demand for the US dollar.

Investors turned cautious amid reports that Iran suspended negotiations with the US, fueling fears of further disruptions to global energy markets, with higher crude prices posing a risk to South Korea's trade balance as a major energy importer.

The currency also remained under pressure from broader risk aversion across regional markets.

Meanwhile, South Korea's annual inflation rate accelerated to 3.1% in May, the highest in more than two years, reinforcing expectations that the Bank of Korea could move toward a rate hike as early as July.

The currency also drew support from continued optimism over the country's semiconductor sector, after Nvidia unveiled a new AI-focused chip and discussed AI memory cooperation with SK Group.



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South Korean Won Weakens Toward 17-Year Low
The South Korean won weakened past 1,517 per dollar, approaching the more than 17-year low of around 1,520 reached on May 22, as renewed Middle East tensions boosted oil prices and supported demand for the US dollar. Investors turned cautious amid reports that Iran suspended negotiations with the US, fueling fears of further disruptions to global energy markets, with higher crude prices posing a risk to South Korea's trade balance as a major energy importer. The currency also remained under pressure from broader risk aversion across regional markets. Meanwhile, South Korea's annual inflation rate accelerated to 3.1% in May, the highest in more than two years, reinforcing expectations that the Bank of Korea could move toward a rate hike as early as July. The currency also drew support from continued optimism over the country's semiconductor sector, after Nvidia unveiled a new AI-focused chip and discussed AI memory cooperation with SK Group.
2026-06-02
South Korean Won Extends Losses on US-Iran Risks
The South Korean won weakened to around 1,515 per dollar, extending losses from the previous session amid lingering uncertainty surrounding US-Iran negotiations and higher oil prices. US President Donald Trump said he was in no hurry to finalize a deal with Iran, despite earlier expectations that an agreement could be reached soon, while disagreements over nuclear terms and the reopening of the Strait of Hormuz continued to cloud the outlook. Rising crude prices added pressure on the won, given South Korea's heavy reliance on energy imports. However, losses were tempered by strong export fundamentals, with South Korea's outbound shipments surging 53% year-on-year to a record $87.8 billion in May, driven by a 169% jump in semiconductor exports. Additionally, the KOSPI climbed to a fresh record high amid continued optimism surrounding AI-related investment and technology demand, helping improve risk appetite.
2026-06-01
Korean Won Remains Under Pressure
The South Korean won weakened to around 1,510 per dollar, extending losses from the previous session. Investors continued to weigh South Korea’s slowing domestic economy and persistent capital outflows despite improving global risk sentiment tied to easing Middle East tensions. Market optimism strengthened after reports indicated that the United States and Iran were moving toward extending their ceasefire arrangement for 60 days while resuming negotiations over Tehran’s nuclear program. Oil prices also eased, with Brent crude falling about 0.4% to near $93 per barrel. At the same time, the US dollar weakened broadly against major developed-market currencies, while Treasury yields declined across the curve during the previous session. Markets also monitored the government’s new reshoring initiative aimed at encouraging overseas Korean firms to return home through broader incentives and more flexible subsidy support for strategic industries.
2026-05-29