FX.co ★ South Korean Won Falls Amid Trade Uncertainty

The South Korean won weakened further, reaching approximately 1,410 per dollar on Friday, marking its fourth consecutive session of decline and sinking to its lowest point since May. This downturn is primarily driven by increasing investor caution amid ongoing uncertainties surrounding trade negotiations with Washington. Talks have stalled after Seoul resisted U.S. demands linked to a proposed $350 billion investment plan. Market analysts have observed that potential outflows exceeding $100 billion annually could put a strain on foreign reserves and potentially hinder economic growth. This deadlock has heightened concerns about South Korea's external economic stance and has made won-denominated assets less attractive to investors. Concurrently, the dollar maintained its strength, bolstered by positive U.S. economic data and strategic positioning ahead of the upcoming PCE inflation report. Revised GDP figures revealed that the U.S. economy expanded at an annualized rate of 3.8% in the second quarter, marking the highest growth in nearly two years, while jobless claims dropped significantly to 218,000, highlighting the persistent robustness of the labor market.