South Korean won hits 2-year high on lower oil, dollar sales

South Korea's currency, the won, reached a two-year high on Monday due to a combination of lower oil prices and increased dollar sales by local companies. The currency surged as much as 0.8% to 1,333.30 per dollar after markets reopened from a three-day weekend, before settling at a 0.5% gain. Economists attribute the strengthening of the won to the broader weakness of currencies such as the euro, pound, and yen, all of which have benefited from lower oil prices.

Min Gyeong-won, an economist at Woori Bank in Seoul, noted that the export-driven dollar sales, particularly from chipmakers, are expected to continue supporting the won's value. However, today's trading volumes are light, with volatility also driven by Japan's holiday-related thin trading. Despite this, the Korean won has appreciated by 7.7% this year, reversing its position as Asia's worst-performing currency in the first half of the year and becoming its best in the second half.