The South Korean won traded near 1,480 per dollar and was on track for a weekly gain of almost 2%, supported by improved regional risk sentiment despite persistent geopolitical and energy-related headwinds. Markets continued to weigh a tentative de-escalation in tensions, with the Strait of Hormuz only partially reopened, even as South Korean equities logged their strongest weekly performance in more than 17 years, bolstering broader risk appetite. The Bank of Korea’s decision to keep its policy rate unchanged at 2.5% also helped anchor interest-rate expectations.
However, further gains in the won were restrained by elevated oil prices, hovering near $100 per barrel, and ongoing shipping disruptions that maintained upward pressure on import costs and inflation. Around 26 South Korean vessels remain stranded in the region, and Seoul is preparing to send a special envoy to Iran. At the same time, foreign capital flows were mixed: equity inflows offered some support, but were insufficient to generate sustained, broad-based demand for the currency.
