South Korea's Finance Official Forecasts Further Won Appreciation in Second Half Amid Dollar Inflows

On July 21, South Korea's Vice Finance Minister Moon Ji-sung forecasted that the Korean won would appreciate further in the second half, citing sustained dollar inflows rather than temporary flows. The official noted that corporate forward exchange sales hit an 18-year high in the second quarter and expect to increase further in the third quarter. Moon emphasized that the current exchange rate level around 1,480 won per dollar is excessively high relative to Korea's economic fundamentals, with both the International Monetary Fund and U.S. Treasury holding the same view. Recent interest rate increases by the Bank of Korea are expected to support currency stability.
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