South Korean Won Hits 17-Year Low

2026-06-04 11:54 By Joana Ferreira 1 min. read

The South Korean won crossed 1,500 per US dollar, touching its weakest level since March 2009, despite government pledges to curb excessive volatility.

The decline highlights the pressure on Asian currencies as the Iran war persists, with higher oil prices and stalled peace talks driving capital reallocation.

External factors, including a sharp rally in domestic stocks prompting foreign investors to rebalance portfolios, have also weighed on the won.

Meanwhile, data this week showed South Korea’s inflation rate surged in May to its highest level in over two years, while exports grew more than expected to a record $87.75 billion, fueled by a global AI investment boom that pushed chip sales to new highs.

Finance Minister Koo Yun-cheol stated that authorities are closely monitoring FX markets "with a high degree of vigilance to prevent anxiety from spreading" and vowed to take "prompt, necessary measures" in case of excessive market moves.

The won has lost over 6% of its value this year.



News Stream
South Korean Won at Over 2-Week Low
The South Korean won traded around 1,545 per dollar, extending losses to its lowest level in over two weeks after MSCI kept South Korea in its emerging-market category. MSCI cited persistent foreign-exchange market accessibility issues, including limited offshore won convertibility and insufficient liquidity during extended trading hours, delaying South Korea's progress toward developed-market status. Additionally, the US dollar remained relatively firm as investors continued to assess the outlook for US monetary policy. Meanwhile, the Bank of Korea reinforced its hawkish stance, signaling that higher interest rates may be needed at an appropriate time as rising housing prices, household debt, and leveraged investments threaten to fuel financial imbalances. Limiting further losses, oil prices eased as concerns over potential disruptions to energy supplies through the Strait of Hormuz softened, providing some relief for the energy-importing economy.
2026-06-24
South Korean Won Remains Under Pressure
The South Korean won weakened to around 1,535 per dollar, remaining under pressure as the US dollar stayed firm. Markets continued to price in the possibility of further Fed tightening, while investors awaited key US inflation data later this week for additional clues on the interest-rate path. Higher US yields continued to support dollar-denominated assets, reducing the appeal of emerging Asian currencies and contributing to broader strength in the greenback. The won also faced headwinds from renewed Middle East uncertainty, with oil prices rising amid ongoing US-Iran negotiations and concerns over potential disruptions to energy supplies through the Strait of Hormuz. Meanwhile, South Korea’s exports surged 60.4% year-on-year in the first 20 days of June, driven by robust semiconductor shipments amid strong global AI-related demand. This supported expectations of continued foreign-currency inflows from overseas sales.
2026-06-22
South Korean Won Reverses Gains
The South Korean won weakened to around 1,538 per dollar, reversing sharply from its recent advance near 1,508, as the dollar remained firm following the Federal Reserve’s policy decision. The Fed kept rates unchanged but signaled a higher policy path than previously projected, reinforcing expectations of tighter financial conditions and supporting broad-based USD demand. The won also came under pressure from ongoing portfolio rebalancing flows and steady demand for the US currency across regional markets. Meanwhile, expectations that the Bank of Korea could maintain a tighter policy stance for longer helped limit downside pressure on the won. The central bank said inflation is likely to remain above target through next year, while policymakers warned that higher energy costs and exchange-rate pass-through effects could continue to fuel price pressures. Authorities’ continued monitoring of foreign exchange volatility also reassured markets.
2026-06-17