The South Korean won traded around 1,373 per dollar, hovering near its strongest level since July 2025, as robust semiconductor exports bolstered dollar inflows and encouraged exporter selling. South Korea’s exports surged 68.7% year-on-year to $98.25 billion in August, while the trade surplus widened to $34.75 billion. Semiconductor shipments jumped 209% to $46.65 billion, underpinned by strong demand for AI-related infrastructure, with month-end and custody-related flows offering additional support for the won.
The currency also drew strength from the Bank of Korea’s 3% policy rate and an improving growth outlook, supported by the government’s record 2027 budget, which allocates increased funding to AI, semiconductors, and other strategic growth sectors. However, renewed US-Iran military clashes and oil prices above $91 per barrel have heightened inflation and risk concerns, while higher US Treasury yields and expectations of further Federal Reserve tightening may cap additional appreciation of the won.
