Won Hits Two-Year High Against Dollar, With BOK Governor Signaling Further Gains
The won has strengthened to the low 1,330-won range against the U.S. dollar, reaching its strongest level in more than two years. The unusual move has come despite several factors that would typically weaken the won, including high oil prices, a stronger dollar and net selling by foreign investors.O
The South Korean won has hit a two-year high against the US dollar, reaching the low 1,330-won range in October. This significant appreciation, which defies typical market dynamics, is attributed to the strong demand for dollars driven by a surge in semiconductor exports, a surplus current account, and abundant corporate foreign-currency deposits.
Bank of Korea Governor Shin Hyun-song has indicated that the current exchange rate is relatively high, suggesting further appreciation may be possible. The government also shares this view, with the Minister of Economy and Finance anticipating a normalization process for the currency. The Bank of Korea's Monetary Policy Board meeting on October 22 is expected to maintain the policy rate unchanged, giving time for the effects of recent rate hikes to be assessed.
Brief written by urgent.news from BusinessKorea's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
