South Korean Won Hits 13-Month High

The South Korean Won touched 1369.00 against the USD, the highest since July 2025. Over the past 4 weeks, US Dollar South Korean Won lost 4.23%, and in the last 12 months, it decreased 1.73%.

The South Korean won traded around 1,370 per dollar, reaching its strongest level since July 2025, amid continued dollar selling by major exporters. Month-end flows and strong semiconductor-led export growth highlighted a favorable trade backdrop, with August shipments forecast to rise more than 60% year-on-year and the trade surplus expected to exceed $30 billion. The won also benefited from the Bank of Korea's back-to-back rate hikes, which lifted its policy rate to 3%, while the central bank raised its 2026 growth forecast to 3.3% on stronger semiconductor exports and domestic demand. The won has gained roughly 5% against the dollar in August. However, hawkish comments from Federal Reserve Chair Kevin Warsh reinforced expectations for a September rate hike, supporting the dollar and US Treasury yields. At the same time, renewed US-Iran tensions pushed oil prices higher, adding to inflation and risk concerns.

The South Korean won traded around 1,375 per dollar in late August, reaching its strongest level since July 2025, as the currency continued to benefit from the Bank of Korea’s back-to-back rate hikes. The BOK raised its policy rate by 25 bps to 3% on Thursday, while Governor Shin Hyun-song said further won appreciation would be desirable as a stronger currency could help contain imported inflation. The rate hike adds to the won's significant rebound from its 17-year low reached in June. Additionally, expectations of increased dollar selling by Samsung Electronics and SK hynix to fund record shareholder returns have been supporting the currency. Robust semiconductor activity also continued to underpin the economic outlook, with the BOK upgrading its 2026 growth forecast to 3.3%, citing a stronger recovery in exports and domestic demand. Meanwhile, investors remained cautious ahead of Federal Reserve Chair Kevin Warsh’s speech at the Jackson Hole symposium.