The South Korean won weakened to around 1,450 per dollar, extending its slide to a more than one-week low amid renewed dollar strength and persistent capital outflows. Selling pressure on the won intensified after the release of the latest Federal Reserve meeting minutes, which revealed divisions among policymakers over the future path of US interest rates. Investors pared back expectations for rate cuts as the Fed signaled a cautious stance in light of still-elevated inflation and a resilient labor market.
Domestic investor sentiment remained subdued despite verbal intervention from the Bank of Korea. The central bank noted that volatility in key domestic financial indicators has risen in recent weeks and pledged to enhance monitoring of potential risk factors for the economy and financial markets. The remarks came during a market assessment meeting chaired by Deputy Governor Yoo Sang-dai following the three-day Lunar New Year holiday.
