The South Korean won traded near 1,381 per dollar in late August, its strongest level since September 2025, after the Bank of Korea raised its benchmark interest rate to 3%. The central bank implemented a second straight 25-basis-point increase, underscoring its tightening stance amid stubborn inflation and a stronger-than-expected economic recovery.
The rate hike has helped extend the won’s sharp rebound from the 17-year low hit in June. Expectations that Samsung Electronics and SK hynix will step up dollar selling to finance record shareholder payouts have provided additional support for the currency.
The won was further buoyed by robust semiconductor sector activity. The Bank of Korea upgraded its 2026 growth forecast to 3.3% from 2.6%, driven by stronger chip exports, while Nvidia’s better-than-expected earnings eased concerns about future demand for AI-related semiconductors.
