FX.co ★ South Korean Won Falls as Outflow Concerns Persist

The South Korean won has depreciated to approximately 1,466 against the US dollar, marking its lowest point in seven months. This slump is attributed to ongoing concerns about continuous capital outflows, which have dampened market sentiment. Investor wariness intensified after the South Korean government clarified on Tuesday that the much-discussed $350 billion investment plan with the United States is in the form of a nonbinding memorandum of understanding. This announcement underscores that the plan is still in preliminary stages, suggesting that while talks about significant US investments are underway, there remains considerable uncertainty regarding the timing and magnitude of any potential dollar outflows. Further contributing to the currency's decline, employment within the manufacturing and construction sectors has continued to diminish. Additionally, youth employment has been on the decline for the 18th consecutive month, highlighting ongoing challenges for younger job seekers.