South Korean Won Rebounds

The South Korean won strengthened to around 1,530 per dollar, rebounding sharply after nearing its weakest level since 2009, as weaker-than-expected US June jobs data weighed on the dollar. The report added to expectations that the Federal Reserve could ease monetary policy in the coming months, supporting Asian currencies. At the same time, the won drew additional support after South Korea's foreign exchange reserves unexpectedly increased to $427.4 billion in June despite market stabilization operations, signaling resilient external buffers and boosting confidence in the country's ability to manage currency volatility. Investors also monitored the government's efforts to stabilize the foreign exchange market after authorities unveiled a KRW 14.9 trillion package of loans and guarantees for small and medium-sized enterprises affected by recent currency swings.

The South Korean won weakened to around 1,553 per dollar, approaching its weakest level since March 2009 near 1,560 touched earlier in June, as persistent foreign selling of local equities and broad demand for the US dollar weighed on the currency. Overseas investors remained net sellers of Korean stocks for an eighth consecutive session, extending a wave of capital outflows as global funds trimmed exposure to Korean technology shares. The won also came under pressure from a firm US dollar as investors pared expectations for near-term Federal Reserve rate cuts. Meanwhile, South Korea reported record trade data for June, with exports surging 70.9% year-on-year to $102.25 billion, marking the first time monthly shipments exceeded $100 billion. The annual inflation rate also accelerated to 3.2% in June, the highest since December 2023, reinforcing expectations that the Bank of Korea could raise interest rates as early as its July 16 policy meeting.

The South Korean won traded around 1,550 per dollar, approaching its weakest level since March 2009 near 1,560 reached earlier in June, as persistent foreign equity outflows continued to weigh on the currency. Overseas investors sold a record KRW 7.7 trillion worth of KOSPI shares in the previous session, extending their net selling streak to seven consecutive trading days. At the same time, South Korea's industrial production fell 0.3% in May, with semiconductor output declining 10% due to shipment adjustments and base effects. Meanwhile, renewed diplomatic talks between the United States and Iran eased concerns over potential disruptions to oil supplies through the Strait of Hormuz, improving broader market sentiment and helping limit additional pressure on the won. For June, the KRW weakened by more than 2% against the US dollar.