South Korean won strengthens as exchange rate hits 23-month low

The South Korean won has strengthened significantly against the US dollar, with the exchange rate dropping to the 1,330–1,340 won range, marking its lowest level in approximately 23 months. This downward trend follows a peak of nearly 1,600 won in July.

Several factors are driving the won's appreciation. A large current account surplus, bolstered by exports exceeding $100 billion for two consecutive months, is increasing the supply of dollars in the domestic market. Additionally, semiconductor companies have been actively converting dollars into won, further supporting the currency's strength.

In response to the falling exchange rate, corporate dollar deposits at major commercial banks have reached record highs, totaling nearly $77 billion. Analysts suggest that export companies may be delaying dollar sales or engaging in split purchases to manage currency volatility. Samsung Securities has lowered its year-end exchange rate forecast from 1,380 won to 1,300 won, citing the downward pressure exerted by the massive current account surplus.