FX.co ★ South Korean Won Rises on Weaker Dollar

The South Korean won appreciated to approximately 1,385 against the dollar on Wednesday, recovering from the previous day's losses. This improvement was largely due to the weakening of the US dollar, following more guarded economic statements from the Federal Reserve. The market's outlook for the export-oriented won was further enhanced by the South Korean government's announcement of additional support measures for crucial export sectors, especially in biopharmaceuticals and the automotive industry. This includes 28.6 trillion won in policy financing, amid the backdrop of significant tariffs imposed by Trump. Investors also focused on the latest series of Korea-US trade negotiations in Washington. During these talks, officials embarked on technical deliberations regarding reciprocal tariffs and essential economic issues, as Seoul seeks to mitigate US tariffs ahead of a July agreement deadline. In other developments, preliminary data indicated a 2.4% year-on-year decline in South Korea’s exports during the first 20 days of May, partly due to reduced shipments to the US, culminating in a $300 million trade deficit.