Korean Won Strengthens as Exporters Boost Dollar Supply
The won averaged 1,342.6 per dollar during the first 12 trading days of October, supported by robust exports, a wider supply of dollars and tighter monetary policy.
South Korea’s won has strengthened sharply against the U.S. dollar as robust exports increase the supply of foreign currency in the domestic market, according to Bank of Korea data released Sunday.
The won averaged 1,342.6 per dollar during the first 12 trading days of October. That was its strongest monthly average since September 2024, when the figure stood at 1,332.8 won, data from the central bank’s Economic Statistics System showed. A lower won-per-dollar rate means the Korean currency has gained value.
The recent move marks a substantial reversal from earlier this year. The monthly average exchange rate climbed to 1,492.5 won in March following the outbreak of war in the Middle East. It rose further to 1,528 won in June as higher crude oil prices and foreign selling of Korean stocks increased demand for dollars.
The won then began a sustained recovery. Its monthly average improved to 1,488.9 in July, 1,404.4 in August and 1,358.8 in September. By 7:20 p.m. Friday, the currency had strengthened to 1,328.9 won per dollar, its firmest level since October 2024.
Economists attributed the appreciation largely to South Korea’s trade surplus and the conversion of export earnings into won. Semiconductor exporters in particular have generated a substantial flow of dollars, while foreign investors’ net sales of Korean shares have been smaller than the country’s daily trade surplus. That imbalance has left more dollars available in the local foreign exchange market.
Domestic economic conditions have also supported the currency. The International Monetary Fund recently raised its 2026 growth forecast for South Korea to 3.3 percent, citing semiconductor exports that outweighed pressure from the Middle East conflict. The Bank of Korea, meanwhile, increased its benchmark interest rate to 3 percent through consecutive moves in July and August, making won-denominated assets relatively more attractive.
Market analysts expect the won to remain in the low- to mid-1,300 range against the dollar through the end of the year. They nevertheless warned that geopolitical risks, oil prices, foreign capital outflows and concerns about the artificial intelligence sector could keep exchange-rate volatility elevated.
The won has also gained strongly against the Japanese currency. Its October monthly average reached 849 won per 100 yen, the strongest level since December 2007.