The Korean won has strengthened against the U.S. dollar in October, driven by robust exports and an increased dollar supply. The won traded at an average of 1,342.6 won per dollar during the first 12 trading days of October, the lowest rate since September 2024, according to the Bank of Korea (BOK). The exchange rate peaked at 1,528 won in June due to rising crude oil prices and foreign stock selling but has since declined as exporters sold dollars.
Experts attribute the won's appreciation to South Korea's trade surplus and ample dollar supply. Baek Seok-hyun, an economist at Shinhan Bank's S&T Center, noted that the semiconductor boom led to dollar selling, with the average daily trade surplus in September nearing $2.5 billion. The central bank's monetary tightening and solid economic growth have also supported the won.
The International Monetary Fund raised South Korea's growth forecast to 3.3 percent for 2026, citing strong semiconductor exports. The BOK lifted its benchmark interest rate to 3 percent in July and August, signaling further increases. Analysts expect the won to trade in the low- to mid-1,300-won per dollar range through the end of the year.
Meanwhile, the won traded at a monthly average of 849 won per 100 Japanese yen in October, its strongest level since December 2007. Experts caution that geopolitical risks, oil price concerns, and capital outflows from the stock market may continue to affect exchange rate volatility.