Won Surges at Fastest Pace Since Global Crisis Amid Dollar Inflows

The Korean won surged last month at its fastest pace since the global financial crisis. The strengthening of the currency was driven by the supply of dollars into the market from SK hynix American depositary receipt (ADR) issuance proceeds and export receipts.

According to data, the won-dollar rate closed at 1,424.0 won at the end of weekly trading on August 31st. This represents a fall of 125.4 won compared to June's closing rate of 1,549.4 won, marking the largest monthly drop since March 2009.

The won's rise stood out among major currencies, with a gain of 7.95% from June's end, ranking first in gains among the Group of 20. The Japanese yen (+3.15%), Swedish krona (+1.91%), and British pound (+1.63%) were also stronger.

Market analysts point to joint intervention by South Korea, the US, and Japan as a contributing factor to the won's appreciation below 1,420 won on August 30th. As the rate slipped, demand picked up from individuals looking to buy dollars at lower prices.