Won Gains Ground as US-Iran Tensions Ease and Foreign Buying Boosts Korea

The South Korean won has strengthened against the US dollar as tensions between the US and Iran ease. The exchange rate dropped by 7.6 won, or 0.51%, to 1,459 won at 9 a.m. on July 27. This decrease is attributed to the decline in investor appetite for safe-haven dollars, which typically increases during times of crisis.

With the US-Iran conflict subsiding, investors are showing more interest in risk assets. The price of West Texas Intermediate (WTI) crude oil has fallen by 3.12% to $89.31 per barrel as a result of this shift. Foreign investors also played a significant role in boosting the won's value, as they were net buyers of 2.135 trillion won on July 24.

The upcoming Federal Reserve (Fed) benchmark rate decision on July 28-29 may have an impact on the exchange rate. The European Central Bank raised interest rates once in June but decided to keep them on hold this month.